UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549



FORM
20-F



| | £ | REGISTRATION
                                         STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934
| | - | ---------------------------------------------------------------------------------------------------------------------------------------



OR



| | £ | ANNUAL
                                         REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
                                                                                For
                                         the fiscal year ended
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



OR



| | £ | TRANSITION REPORT
                                         PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
| | - | ---------------------------------------------------------------------------------------------------------------------------------



OR



| | S | SHELL COMPANY REPORT
                                         PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
| | - | ------------------------------------------------------------------------------------------------------------------------------------



Date of
event requiring this shell company report: December 24, 2013



For the
transition period from ________ to ________



Commission
file number: 000-54293

__________



LONE
OAK ACQUISITION CORPORATION(Exact name of the Registrant as specified in its charter)

__________



Cayman
Islands(Jurisdiction of incorporation or organization)



500W.
Texas AvenueSuite 1450Midland, Texas 79701
(Address of principal executive offices)



Jason
HoisagerArabella Exploration, Limited Liability Company500W. Texas AvenueSuite 1450Midland, Texas 79701Telephone: 432 897-4755Fax No.: 800 729-0160
(Name, Telephone, E-mail and/or Facsimile Number and Address of Company Contact Person)

__________











Securities
registered or to be registered pursuant to Section 12(b) of the Act: None
Securities registered or to be registered pursuant to Section 12(g) of the Act:



Units

(Title of
Class)



ordinary
shares, $0.001 par value

(Title of
Class)



Ordinary
Share Purchase Warrants

(Title of
Class)



Securities
for which there is a reporting obligation pursuant to Section 15(d) of the Act: None.



On December
26, 2013, the issuer had 4,829,826 ordinary shares outstanding.



Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes  £ No  S



If this
report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934. Yes  S  No 
£



Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days. Yes  S No  £



Indicate
by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the
preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes  S No  £



Indicate
by check mark whether the registrant is a large accelerated filer, an accelerated filer or a non-accelerated filer. See definition
of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act.



|£
    Large Accelerated filer | £ Accelerated
    filer | S
    Non-accelerated filer
|----------------------------- | ----------------------- | ---------------------------



Indicate
by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:



|S	US
    GAAP | £	International
    Financial Reporting Standards as issued by the International Accounting Standards Board | £	Other
|------------- | ----------------------------------------------------------------------------------------------------------- | -------



If “Other”
has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has
elected to follow. £ Item 17   £Item 18



If this
is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act). Yes  £  No  £











Table
of Contents



|         |                                                                       | Page
|-------- | --------------------------------------------------------------------- | ----
|         |                                                                       |     
|PART I2  |                                                                       |     
|ITEM 1.  | IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS                 | 2   
|ITEM 2.  | OFFER STATISTICS AND EXPECTED TIMETABLE                               | 2   
|ITEM 3.  | KEY INFORMATION                                                       | 2   
|         | A.Selected
    Financial Data                                         | 2   
|         | B.      Capitalization
    and Indebtedness                           | 3   
|         | C.      Reasons
    for the Offer and Use of Proceeds                 | 3   
|         | D.      Risk
    Factors                                              | 3   
|ITEM 4.  | INFORMATION ON THE COMPANY                                            | 3   
|         | A.     History
    and Development of the Company                     | 3   
|         | B.Business
    Overview                                               | 4   
|         | C.     Organizational
    Structure                                   | 4   
|         | D.Property,
    Plant and Equipment                                   | 4   
|ITEM 4A. | UNRESOLVED STAFF COMMENTS                                             | 4   
|ITEM 5.  | OPERATING AND FINANCIAL REVIEW AND PROSPECTS                          | 4   
|ITEM 6.  | DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES                            | 4   
|         | A.      Directors
    and Senior Management                           | 4   
|         | B.      Compensation                                                  | 5   
|         | C.      Board
    Practices                                           | 5   
|         | D.      Employees                                                     | 5   
|         | E.Share
    Ownership                                                 | 5   
|ITEM 7.  | MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS                     | 5   
|         | A. Major
    Shareholders                                             | 5   
|         | B.       Related
    Party Transactions                               | 7   
|         | C.       Interests
    of Experts and Counsel                         | 7   
|ITEM 8.  | FINANCIAL INFORMATION                                                 | 7   
|         | A.       Consolidated
    Statements and Other Financial Information. | 7   
|         | B.        Significant
    Changes.                                    | 7   
|ITEM 9.  | THE OFFER AND LISTING                                                 | 7   
|         | A.       Offer
    and Listing Details.                               | 7   
|         | B.        Plan
    of Distribution                                    | 7   
|         | C.         Markets                                                    | 8   
|         | D.        Selling
    Shareholders                                    | 8   
|         | E.         Dilution                                                   | 8   
|         | F.         Expenses
    of the Issue                                  | 8   
|ITEM 10. | ADDITIONAL INFORMATION                                                | 8   
|         | A.Share
    Capital                                                   | 8   
|         | B.         Memorandum
    and Articles of Association                 | 8   
|         | C.         Material
    Contracts                                     | 10  
|         | D.        Exchange
    controls                                       | 10  
|         | E.        Taxation                                                    | 10  
|         | F.         Dividends
    and paying agents                            | 10  
|         | G.         Statement
    by Experts                                   | 11  
|         | H.         Documents
    on Display                                   | 11  
|         | I.          Subsidiary
    Information                                | 11  
|ITEM 11. | QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK             | 11  











Table
of Contents continued





|         |                                                        | Page
|-------- | ------------------------------------------------------ | ----
|         |                                                        |     
|ITEM 12. | DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES | 11  
|         |                                                        |     
|PART II  |                                                        | 11  
|         |                                                        |     
|PART III |                                                        | 11  
|ITEM 17. | FINANCIAL STATEMENTS                                   | 11  
|ITEM 18. | FINANCIAL STATEMENTS                                   | 12  
|ITEM 19. | EXHIBITS                                               | 29  











CERTAIN
INFORMATION



Except where the context requires
otherwise and for purposes of this report only:



| | · | “Lone Oak,”
                                         “we,” “us,” “Company,” or “our,” refers
                                         to Lone Oak Acquisition Corporation, a company with limited liability incorporated in
                                         the Cayman Islands.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | “Arabella”
                                         refers to Arabella Exploration, Limited Liability Company, which is our wholly owned
                                         subsidiary after giving effect to the Business Combination.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | “Business Combination”
                                         refers to our acquisition of Arabella on December 24, 2013, pursuant to the merger of
                                         our wholly owned subsidiary, Arabella Exploration Corp., with and into Arabella.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | “IPO”
                                         or “initial public offering” refers to our initial public offering pursuant
                                         to our prospectus, dated March 16, 2011 and filed with the Securities and Exchange Commission
                                         on March 22, 2011, which was consummated on March 30, 2011.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | “Offer Letter”
                                         refers to the Offer Letter filed as exhibit (a)(1)(A) to Amendment No. 6 to the Schedule
                                         TO we filed with the Securities and Exchange Commission on December 16, 2013.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | “Shares”
                                         or “ordinary shares” refers to our ordinary shares, par value $0.001 per
                                         share.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | “Tender Offer”
                                         means our tender offer for our ordinary shares described in the Offer Letter, which was
                                         completed on December 24, 2013.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Any discrepancies
                                         in any table between the amounts identified as total amounts and the sum of the amounts
                                         listed therein are due to rounding.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



FORWARD-LOOKING
STATEMENTS



The statements contained in
this report that are not purely historical are forward-looking statements. Our forward-looking statements include, but are not
limited to, statements regarding our or our management’s expectations, hopes, beliefs, intentions or strategies regarding
the future. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances,
including any underlying assumptions, are forward-looking statements. The words “anticipates,” “believe,”
“continue,” “could,” “estimate,” “expect,” “intend,” “may,”
“might,” “plan,” “possible,” “potential,” “predict,” “project,”
“should,” “would” and similar expressions may identify forward-looking statements, but the absence of
these words does not mean that a statement is not forward-looking. Forward-looking statements in this report may include, for
example, statements about our:



| | · | Continued compliance
                                         with government regulations;
| | - | ------------------------------------------------------------------------------------------



| | · | Changing legislation
                                         or regulatory environments;
| | - | -----------------------------------------------------------------------------------------



| | · | Requirements or changes
                                         affecting the businesses in which we are engaged;
| | - | ------------------------------------------------------------------------------------------------------------------



| | · | Industry trends,
                                         including factors affecting supply and demand;
| | - | --------------------------------------------------------------------------------------------------------



| | · | Labor and personnel
                                         relations;
| | - | -----------------------------------------------------------------------



| | · | Credit risks affecting
                                         our revenue and profitability;
| | - | ----------------------------------------------------------------------------------------------



| | · | Changes in the oil
                                         and gas industry in general and oil and gas prices specifically;
| | - | ----------------------------------------------------------------------------------------------------------------------------



| | · | The ability of our
                                         management to effectively manage our growth, including implementing effective controls
                                         and procedures and attracting and retaining key management and personnel;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Changing interpretations
                                         of generally accepted accounting principles;
| | - | --------------------------------------------------------------------------------------------------------------



1







| | · | Our public securities’
                                         limited liquidity and trading;
| | - | ----------------------------------------------------------------------------------------------



| | · | General economic
                                         conditions; and
| | - | -------------------------------------------------------------------------



| | · | Other relevant risks
                                         detailed in our filings with the Securities and Exchange Commission.
| | - | ----------------------------------------------------------------------------------------------------------------------------------



The forward-looking statements
contained in this report are based on our current expectations and beliefs concerning future developments and their potential
effects on us. There can be no assurance that future developments affecting us will be those that we have anticipated. These forward-looking
statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause
actual results or performance to be materially different from those expressed or implied by these forward-looking statements.
These risks and uncertainties include, but are not limited to, those factors described under the heading “Risk Factors.”
Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results
may vary in material respects from those projected in these forward-looking statements. We undertake no obligation to update or
revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required
under applicable securities laws and/or if and when management knows or has a reasonable basis on which to conclude that previously
disclosed projections are no longer reasonably attainable.



PART
I



| | ITEM 1. | IDENTITY
                                         OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS
| | ------- | ----------------------------------------------------------------------------------------------



A. Directors and Senior Management.



Our directors and executive
officers immediately following the consummation of the Business Combination are described in the Offer Letter under the heading
“Management—Post-Acquisition Management” beginning on page 103, which description is incorporated herein by
reference.



B. Advisers



Conyers Dill & Pearman acts
as Cayman Islands counsel to us. Loeb & Loeb LLP acts as United States counsel to us. Strasburger & Price, LLP acts as
United States counsel to Arabella.



C. Auditors



The audited balance sheets of
Arabella as of December 31, 2011 and 2012 and the related statements of operations, member’s equity, and cash flows for
the years then ended, have been included in this report in reliance on the report of Ham, Langston & Brezina, LLP, Houston,
Texas, an independent registered public accounting firm, appearing elsewhere in this report upon the authority of the said firm
as experts in accounting and auditing. Ham, Langston & Brezina, LLP has served as Arabella’s independent registered
accounting firm since 2011.



| | ITEM 2. | OFFER
                                         STATISTICS AND EXPECTED TIMETABLE
| | ------- | --------------------------------------------------------------------------------



Not required.



| | ITEM 3. | KEY
                                         INFORMATION
| | ------- | --------------------------------------------------------



| | A. | Selected
                                         Financial Data
| | -- | ----------------------------------------------------------------



2







Arabella Selected Financial
Data



Following the Business Combination,
Arabella is considered to be our predecessor for accounting purposes, as further described in Item 18 of this report. The following
selected consolidated financial data have been derived from the Arabella audited combined financial statements as of December
31, 2011 and 2012 and for the years then ended, and the unaudited combined financial statements as of June 30, 2013 and for the
period then ended, which are included elsewhere in this report. The consolidated financial statements are prepared and presented
in accordance with US GAAP. The results of operations in any period may not necessarily be indicative of the results that may
be expected for any future period. See “Risk Factors” included elsewhere in this report. The selected combined financial
information as of December 31, 2011 and 2012 and June 30, 2013 and for the years ended December 31, 2011and 2012 and the period
ended June 30, 2013 should be read in conjunction with those consolidated financial statements and the accompanying notes and
“Management’s Discussion and Analysis of Financial Condition and Results of Operations” included elsewhere in
this report.





|                   |  | As of December 31, |         |   | As of December 
    31, |   |           | As of June 30, | 
|------------------ |  | ------------------ | ------- | - | ----------------------- | - | --------- | -------------- | 
|Balance Sheet Data |  | 2011               |         |   | 2012                    |   |           | 2013           | 
|                   |  |                    |         |   |                         |   |           | (unaudited)    | 
|Working capital    |  | $                  | (6,270  | ) |                         | $ | (41,660   | )              | 
|Total assets       |  |                    | 197,293 |   |                         |   | 1,756,309 |                | 
|Total liabilities  |  |                    | 168,757 |   |                         |   | 1,307,897 |                | 
|Members’ equity    |  |                    | 28,536  |   |                         |   | 448,412   |                | 



|Selected statement of operation data: |  | For the year ended 
    December 31, 2011 |        |   | For the year ended 
    December 31, 2012 |   |         | For the period 
    ended June 30, 
    2013 | 
|------------------------------------- |  | ----------------------------------------- | ------ | - | ----------------------------------------- | - | ------- | -------------------------------------------- | 
|                                      |  |                                           |        |   |                                           |   |         | (unaudited)                                  | 
|Total Revenues                        |  | $                                         | 51,010 |   |                                           | $ | 468,782 |                                              | 
|Total costs and operating expenses    |  |                                           | 52,475 |   |                                           |   | 147,466 |                                              | 
|Net income (loss)                     |  |                                           | (1,465 | ) |                                           |   | 321,316 |                                              | 



| | B. | Capitalization
                                         and Indebtedness
| | -- | ------------------------------------------------------------------------



Not required.



| | C. | Reasons
                                         for the Offer and Use of Proceeds
| | -- | ----------------------------------------------------------------------------------



Not required.



| | D. | Risk
                                         Factors
| | -- | -----------------------------------------------------



The risks associated with our
business are described in the Offer Letter under the heading “Risk Factors” beginning on page 19, which description
is incorporated herein by reference.



| | ITEM 4. | INFORMATION
                                         ON THE COMPANY
| | ------- | -------------------------------------------------------------------



| | A. | History
                                         and Development of the Company
| | -- | -------------------------------------------------------------------------------



The history and development
of Lone Oak are described in the Offer Letter under the heading “Summary— Background Information” beginning
on page 10, the heading “Information About Lone Oak” beginning on page 41, and the heading “Information About
Arabella” beginning on page 44, which descriptions are incorporated herein by reference.



3







In addition, on December 24,
2013, Lone Oak completed the Tender Offer related to the Business Combination and redeemed the 439,400 shares validly tendered
and not withdrawn, and on December 24, 2013, it consummated the Business Combination by acquiring Arabella and issuing 3,125,000
to the former members of Arabella. As a result, following consummation of the Business Combination, Lone Oak had a total of 4,829,826
ordinary shares outstanding. Additionally, 1,705,002 shares have been escrowed for the benefit of the former members of Arabella
conditioned upon the achievement by Lone Oak of certain performance hurdles described in the Offer Letter under the heading “Acquisition
Consideration” beginning on page 12. Until earned, such shares are being treated as treasury shares of the Company.



A description of the Business
Combination is included in the Offer Letter under the heading “The Acquisition” beginning on page 81, which descriptions
are incorporated herein by reference.



| | B. | Business
                                         Overview
| | -- | ----------------------------------------------------------



As a result of the Business
Combination, we succeeded to the business of Arabella, which is described in the Offer Letter under the heading “Information
about Arabella” beginning on page 44, which description is incorporated herein by reference.



| | C. | Organizational
                                         Structure
| | -- | -----------------------------------------------------------------



Arabella is a Texas limited
liability company and, following the Business Combination, is wholly owned by us. Neither Arabella nor we own interests in any
other entities.



| | D. | Property,
                                         Plant and Equipment
| | -- | ----------------------------------------------------------------------



Information regarding our property,
plants and equipment is described in the Offer Letter under the heading “Information About Arabella” beginning on
page 44, which description is incorporated herein by reference.



| | ITEM
                            4A. | UNRESOLVED STAFF COMMENTS
| | ------------------------------------ | -------------------------



Not required.



| | ITEM 5. | OPERATING
                                         AND FINANCIAL REVIEW AND PROSPECTS
| | ------- | -------------------------------------------------------------------------------------



Our operating and financial
review and prospects are described in the Offer Letter under the heading “Management’s Discussion and Analysis of
Financial Condition and Results of Operations of the Target Company” beginning on page 93, which description is incorporated
herein by reference.



| | ITEM 6. | DIRECTORS,
                                         SENIOR MANAGEMENT AND EMPLOYEES
| | ------- | -----------------------------------------------------------------------------------



| | A. | Directors
                                         and Senior Management
| | -- | ------------------------------------------------------------------------



Our directors and executive
officers immediately following the consummation of the Business Combination are described in the Offer Letter under the heading
“Summary—Agreement and Plan of Merger and Reorganization—Board of Directors of the Combined Company; Voting
Agreement” beginning on page 14, the heading “Management—Post-Acquisition Management” beginning on page
103, and the heading “Management—Family Relationships” on page 105, which descriptions are incorporated herein
by reference.



4







| | B. | Compensation
| | -- | ------------



The compensation of our executive
officers and directors is described in the Offer Letter under the heading “Director and Executive Compensation— Director
and Executive Compensation Post-Acquisition” beginning on page 107, which description is incorporated herein by reference.



| | C. | Board
                                         Practices
| | -- | --------------------------------------------------------



Our board practices are described
in the Offer Letter under the heading “Management—Board Committees” beginning on page 105, and the heading “Director
and Executive Compensation— Director and Executive Compensation Post-Acquisition” beginning on page 107, which descriptions
are incorporated herein by reference. Each of Lone Oak’s directors serves until such director resigns or is replaced by
the shareholders at a shareholder’s meeting or pursuant to a written consent of shareholders.



| | A. | Employees
| | -- | ---------



As of the closing of the Business
Combination, we have ___ employees. The information in the Offer Letter under the heading “Information About Arabella—Employees”
on page 80 is incorporated herein by reference.



| | B. | Share
                                         Ownership
| | -- | --------------------------------------------------------



See Item 7 below, which is incorporated
herein by reference.



| | ITEM 7. | MAJOR
                                         SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
| | ------- | ------------------------------------------------------------------------------------------



| | A. | Major
                                         Shareholders
| | -- | -----------------------------------------------------------



The following
table sets forth information with respect to the beneficial ownership, within the meaning of Rule 13d-3 under the Exchange Act,
of our ordinary shares, as of December 24, 2013:



| | · | each person known to us to own beneficially more than 5% of our ordinary shares;
| | - | --------------------------------------------------------------------------------
| | · | each of our directors and executive officers; and                               
| | · | all of our directors and executive officers as a group.                         



Beneficial
ownership includes voting or investment power with respect to the securities and takes into consideration options or warrants
exercisable by a person within 60 days after the date of this report. Except as indicated below, and subject to applicable community
property laws, the persons named in the table have sole voting and investment power with respect to all securities shown as beneficially
owned by them.



5









|Name and Address (1)                                             |  | Number of Shares Beneficially
    Owned |           |  | Percentage
    ofOwnership (2) | 
|---------------------------------------------------------------- |  | --------------------------------------- | --------- |  | ------------------------------ | 
|Directors and executive officers:                                |  |                                         |           |  |                                | 
|Berke Bakay(3)                                                   |  |                                         | 3,287,355 |  |                                | 
|Jason Hoisager                                                   |  |                                         | 1,469,012 |  |                                | 
|Terry E. Sanford                                                 |  |                                         | 0         |  |                                | 
|Chad D. Elliott                                                  |  |                                         | 130,032   |  |                                | 
|Richard J. Hauser(4)                                             |  |                                         | 3,278,428 |  |                                | 
|William B. Heyn(5)                                               |  |                                         | 267,664   |  |                                | 
|                                                                 |  |                                         |           |  |                                | 
|All directors and executive officers as a group  (6 individuals) |  |                                         | 8,432,491 |  |                                | 
|                                                                 |  |                                         |           |  |                                | 
|Principal shareholders:                                          |  |                                         |           |  |                                | 
|BBS Capital Fund, LP(3)                                          |  |                                         | 3,278,428 |  |                                | 
|Hauser Holdings LLC(4)                                           |  |                                         | 3,278,428 |  |                                | 
|Greg McCabe                                                      |  |                                         | 1,003,597 |  |                                | 
|Travis Street Energy, LLC(6)                                     |  |                                         | 312,500   |  |                                | 
|John V. Calce(7)                                                 |  |                                         | 267,662   |  |                                | 
|James R. Preissler(8)                                            |  |                                         | 267,662   |  |                                | 





| | * | less than one percent
                                         (1%).
| | - | --------------------------------------------------------------------



(1)	          Unless
otherwise noted, the business address for each of our beneficial owners is 500 W. Texas Avenue, Suite 1450, Midland, Texas 79701.



(2)		        
Based on 4,829,826 ordinary shares outstanding post acquisition, taking into account the shares issued in the Business Combination,
but excluding the treasury shares held in escrow subject to certain performance targets, and the warrants which became exercisable
upon close of the Business Combination. Such warrants are deemed to be outstanding for the purpose of computing the percentage
ownership of the indicated individual or group, but are not deemed to be outstanding for the purpose of computing the percentage
ownership of any other person shown in the table.



(3)	          The
number of ordinary shares beneficially owned by Mr. Bakay consists of (i) 345,928 ordinary shares beneficially owned by BBS Capital
Fund, LP, (ii) 8,927 ordinary shares owned by Mr. Bakay, and (iii) warrants exercisable for 2,932,500 ordinary shares, all of
which are owned by BBS Capital Fund, LP. Mr. Bakay and BBS Capital Fund, LP have sole voting and dispositive power over all such
securities. The address of BBS Management Group is 5524 E. Estrid Avenue, Scottsdale, Arizona 85254. Messrs. Heyn, Calce and Preissler
each have an option to purchase warrants to purchase 247,500 shares (742,500 in the aggregate) from BBS Capital Fund, LP.



(4)		          The
number of ordinary shares beneficially owned by Mr. Hauser consists of (i) 345,928 ordinary shares beneficially owned by Hauser
Holdings, LLC, and (ii) warrants exercisable for 2,932,500 ordinary shares, all of which are owned by Hauser Holdings, LLC. Mary
Jane Hauser has sole voting and dispositive power over all securities held by Hauser Holdings LLC. The address of Hauser Holdings
LLC is 50 South Sixth Street, Minneapolis, Minnesota 55402. Ms. Hauser is the wife of Richard J. Hauser, one of our directors.
Messrs. Heyn, Calce and Preissler each have an option to purchase warrants to purchase 247,500 shares (742,500 in the aggregate)
from Hauser Holdings, LLC.



(5)		         The
number of ordinary shares beneficially owned by Mr. Heyn consists of (i) 102,664 ordinary shares and (ii) warrants exercisable
for 165,000 ordinary shares.  Mr.
Heyn has an option from each of BBS Capital Fund, LP and Hauser Holdings, LLC to purchase warrants to purchase 247,500 shares
(495,000 in the aggregate).



6







(6)		         Mark
G. Avery has sole voting and dispositive power over all ordinary shares held by Travis Street Energy, LLC. The address of Travis
Street Energy, LLC is 712 S. Main Street, Suite 1200, Houston, Texas 77002.



(7)		         The
number of ordinary shares beneficially owned by Mr. Calce consists of (i) 102,662 ordinary shares and (ii)
warrants exercisable for 165,000 ordinary shares. The business address of Mr. Calce is 17950 Preston Road, Suite 1080A
Dallas, Texas 75252. Mr. Calce has an option from each of BBS Capital Fund, LP and Hauser Holdings, to purchase warrants to
purchase 247,500 shares (495,000 in the aggregate).



(8)		         The
number of ordinary shares beneficially owned by Mr. Preissler consists of (i) 102,662 ordinary shares and (ii) warrants exercisable
for 165,000 ordinary shares. The business address of Mr. Preissler is 50 Old Route 25A Fort Salonga, NY 11768.
Mr. Preissler has an option from each of BBS Capital Fund, LP and Hauser Holdings, LLC to purchase warrants to purchase 247,500
shares (495,000 in the aggregate).



As of December 24, 2013, approximately
86% of our outstanding ordinary shares are held by eight record holders in the United States.



A description of the voting agreement entered into by the founding shareholders of Lone Oak and the former
Members of Arabella is included in the Offer Letter under the heading “Acquisition - Board of Directors of the Combined Company;
Voting Agreement” beginning on page 85, which description is incorporated herein by reference.



| | B. | Related
                                         Party Transactions
| | -- | -------------------------------------------------------------------



Related party transactions are
described in the Offer Letter under the heading “Certain Relationships and Related Transactions” beginning on page
125, which description is incorporated herein by reference.



| | C. | Interests
                                         of Experts and Counsel
| | -- | -------------------------------------------------------------------------



Not required.



| | ITEM 8. | FINANCIAL
                                         INFORMATION
| | ------- | --------------------------------------------------------------



| | A. | Consolidated
                                         Statements and Other Financial Information.
| | -- | -------------------------------------------------------------------------------------------------



See Item 18, which is incorporated
herein by reference.





In various letters received in December 2013 from counsel for
Baker Hughes Oilfield Operations, Inc. (“BH") to Arabella Petroleum Company ("Arabella Petroleum"), the operating
company and an affiliate of Arabella Exploration, LLC, BH asserted that it provided labor, equipment and materials at the request
of Arabella Petroleum in connection with mineral activities on tracts of land in Reeves County, Texas, with respect to which BH
asserts Arabella Petroleum is an owner of all or a portion of the mineral leasehold estate (the "Leasehold"), commonly
referred to as the "Wolfbone Project." The amount of the BH claim is $3,191,180.79, plus interest. In connection with
such claim, BH has claimed a lien on the Leasehold and related assets and filed a mineral lien affidavit in Reeves County, Texas.
In addition, BH has filed a demand for arbitration regarding its claim with the American Arbitration Association. Arabella Petroleum
does not believe such amounts are owed to BH due to the failure of BH to satisfactorily perform the services it was contracted
to perform.





| | B. | Significant
                                         Changes.
| | -- | -------------------------------------------------------------



None.



| | ITEM 9. | THE
                                         OFFER AND LISTING
| | ------- | --------------------------------------------------------------



| | A. | Offer
                                         and Listing Details.
| | -- | -------------------------------------------------------------------



The price history for our securities
is described in the Offer Letter under the heading “Market Price Information” beginning on page 18, which description
is incorporated herein by reference. A description of the rights of our securities other than equity securities is included under
the heading “Description of Securities” in our registration statement on Form F-1 (File No. 333-172334), initially
filed with the Securities and Exchange Commission on February 18, 2011, as amended, which description is incorporated herein by
reference.



| | B. | Plan
                                         of Distribution
| | -- | -------------------------------------------------------------



Not Required.



7







| | C. | Markets
| | -- | -------



The markets for our securities
are described in the Offer Letter under the heading “Market Price Information” beginning on page 18, which description
is incorporated herein by reference.



| | D. | Selling
                                         Shareholders
| | -- | -------------------------------------------------------------



Not Required.



| | E. | Dilution
| | -- | --------



Not Required.



| | F. | Expenses
                                         of the Issue
| | -- | --------------------------------------------------------------



Not Required.



| | ITEM 10. | ADDITIONAL
                                         INFORMATION
| | -------- | ---------------------------------------------------------------



| | A. | Share
                                         Capital
| | -- | ------------------------------------------------------



As of December 24, 2013
and June 30, 2013, we had a total of 50,000,000 authorized ordinary shares, par value $.001 per share, and 5,000,000
authorized shares of preferred stock,  par value $.001 per share, of which 4,829,826 ordinary shares and no shares of
preferred stock were issued and outstanding as of December 24, 2013 and 2,164,226 ordinary shares and no shares of preferred
stock were outstanding at June 30, 2013. All outstanding shares were fully paid.



As of December 24, 2013
and June 30, 2013,
we have issued warrants to purchase 10,706,500 ordinary shares, options to purchase 400,000 units consisting of one ordinary
share and one warrant to purchase an ordinary share, and options to purchase 60,000 ordinary shares.



| | B. | Memorandum
                                         and Articles of Association
| | -- | -------------------------------------------------------------------------------



Amended and Restated Memorandum
and Articles of Association



Summary



Registered Office. Under our
Amended and Restated Memorandum of Association, our Registered Office is located at the offices of Codan Trust Company (Cayman)
Limited, Cricket Square, Hutchins Drive, PO Box 2681, Grand Cayman, KY1-1111, Cayman Islands.



Objects and Purposes. Under
Article 3 of our Amended and Restated Memorandum of Association, the objects for which we are established are unrestricted.



Directors. Under Article 94
of our Articles of Association, no contract or transaction between us and one or more of our Directors (an “Interested Director”)
or officers, or between us and any of their affiliates (an “Interested Transaction”), will be void or voidable solely
for this reason, or solely because the director or officer is present at or participates in the meeting of our board or committee
which authorizes the contract or transaction, or solely because any such director’s or officer’s votes are counted
for such purpose, if:



| | (a) | The material facts as to the director’s or officer’s
                                         relationship or interest and as to the contract or transaction are disclosed or are known
                                         to the our board of directors or the committee, and the board or committee in good faith
                                         authorizes the contract or transaction by the affirmative votes of a majority of the
                                         disinterested directors, even though the disinterested directors be less than a quorum;
                                         or
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



8







| | (b) | The material facts as to the director’s or officer’s
                                         relationship or interest and as to the contract or transaction are disclosed or are known
                                         to our shareholders entitled to vote thereon, and the contract or transaction is specifically
                                         approved in good faith by vote of our shareholders; or
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (c) | The contract or transaction is fair as to us as of the time it
                                         is authorized, approved or ratified, by the board, a committee or the Shareholders.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



A majority of independent directors
must vote in favor of any Interested Transaction and determine that the terms of the Interested Transaction are no less favorable
to us than those that would be available to us with respect to such a transaction from unaffiliated third parties.



Rights, Preferences and Restrictions
Attaching to Our Ordinary Shares. We are authorized to issue 50,000,000 ordinary shares, par value $0.001 and 5,000,000 shares
of preferred stock, par value $0.001 per share. As of the date of this report, 4,829,826 ordinary shares are issued and outstanding.
Each ordinary share has the right to one vote at a meeting of shareholders or on any resolution of shareholders, the right to
an equal share in any dividend paid by us, and the right to an equal share in the distribution of surplus assets. We may by a
resolution of the board of directors redeem our ordinary shares for such consideration as the board of directors determines.



If, at any time, our share capital
is divided into different classes of shares, the rights attached to any class (unless otherwise provided by the terms of issue
of the shares of that class) may, whether or not we are being wound-up, be varied with the consent in writing of the holders of
three-fourths of the issued shares of that class or with the sanction of a resolution passed by a majority of the votes cast at
a separate general meeting of the holders of the shares of the class at which meeting the necessary quorum shall be two persons
at least holding or representing by proxy one-third of the issued shares of the class.



Additional information regarding
our securities is included under the heading “Description of Securities” in our registration statement on Form F-1
(File No. 333-172334), initially filed with the Securities and Exchange Commission on February 18, 2011, as amended, which is
incorporated herein by reference.



Our annual meeting may be held
at such time and place as their chairman or any two directors or any director and the secretary or the board of directors shall
appoint. The chairman or any two directors or any director and the secretary or the board of directors may convene an extraordinary
general meeting whenever in their judgment such a meeting is necessary. At least 10 clear days’ notice of an annual meeting
shall be given to each shareholder entitled to attend and vote thereat, stating the date, place, and time at which the meeting
is to be held, and if different, the record date for determining shareholders entitled to attend and vote at the annual meeting,
and, if practicable, the other business to be conducted at the meeting. At least 10 clear days’ notice of an extraordinary
general meeting shall be given to each shareholder entitled to attend and vote thereat, stating the date, place, and time at which
the meeting is to be held, and the general nature of the business to be considered at the meeting. A meeting shall, notwithstanding
the fact that it is called on shorter notice than otherwise required, be deemed to have been properly called if it is so agreed
by (i) all of the shareholders entitled to attend and vote thereat in the case of an annual meeting, and (ii) 75% of the shareholders
entitled to attend and vote thereat in the case of an extraordinary general meeting. The accidental omission to give notice of
a meeting to, or the non-receipt of a notice of a meeting by, any person entitled to receive notice shall not invalidate the proceedings
at that meeting.



9







There are no limitations on
the rights to own our securities, or limitations on the rights of non-resident or foreign shareholders to hold or exercise voting
rights on our securities, contained in our Amended and Restated Memorandum and Articles of Association (or under Cayman Islands
law).



| | C. | Material
                                         Contracts
| | -- | -----------------------------------------------------------



Information concerning our material
contracts governing the business of the Company is included elsewhere in this report or in the information incorporated by reference
herein.



On December 24, 2013, Lone Oak
entered into an employment agreement with Jason Hoisager pursuant to which Mr. Hoisager agreed to act as the Chief Executive Officer
and President of Lone Oak. The employment agreement has a term of one year and will automatically renew for additional one-year
terms after the end of the initial term if the agreement is not terminated at least 90 days prior to the end of the applicable
term. The employment agreement provides for a base salary of $300,000 a year, with bonus determined by Lone Oak’s board
of directors. If Lone Oak terminates the employment agreement without cause, Mr. Hoisanger terminates the employment agreement
for good reason, or Mr. Hoisanger’s employment is terminated within six months after a change in control, Mr. Hoisanger
will be entitled to severance equal to 24 months of his base salary and an amount equal to his bonus for the prior year.



On December 24, 2013, Lone Oak
entered into a registration rights agreement with the former members of Arabella pursuant to which the Company granted such members
the right to make up to two demands that Lone Oak register the securities received in connection with the Business Combination.
In addition, the former members of Arabella have certain “piggy-back” registration rights with respect to registration
statements filed subsequent to our consummation of a business combination. Lone Oak will bear the expenses incurred in connection
with the filing of any such registration statements.



| | D. | Exchange
                                         controls
| | -- | ----------------------------------------------------------



Under Cayman Islands law, there
are currently no restrictions on the export or import of capital, including foreign exchange controls or restrictions that affect
the remittance of dividends, interest or other payments to nonresident holders of our securities.



| | E. | Taxation
| | -- | --------



The material United States federal
income tax consequences of the Business Combination and of owning and disposing of our securities following the Business Combination
are described in the Offer Letter under the heading “Material U.S. Federal Income Tax Consequences” beginning on page
128, which description is incorporated herein by reference.



| | F. | Dividends
                                         and paying agents
| | -- | --------------------------------------------------------------------



On April 3, 2013, Lone Oak announced
the authorization of a previously announced one-time cash dividend of $0.10 per outstanding Ordinary Share. The dividend was paid
on April 25, 2013.



On October 4, 2013, Lone Oak
announced the authorization of a previously announced one-time cash dividend of $0.10 per outstanding Ordinary Share. The dividend
was paid on October 24, 2013.



Lone Oak does not anticipate
paying any additional cash dividends on its ordinary shares in the foreseeable future. Lone Oak currently intends to retain future
earnings, if any, to finance the expansion of Lone Oak’s business. Lone Oak’s future dividend policy is within the
discretion of Lone Oak’s board of directors and will depend upon various factors, including Lone Oak’s business, financial
condition, results of operations, capital requirements and investment opportunities.



10







| | G. | Statement
                                         by Experts
| | -- | -------------------------------------------------------------



The consent of Ham, Langston
& Brezina, LLP is included as an exhibit to this report.



| | H. | Documents
                                         on Display
| | -- | -------------------------------------------------------------



Documents concerning us that
are referred to in this document may be inspected at our principal executive offices at 500 W. Texas Avenue, Suite 1450, Midland,
Texas 79701.



In addition, we will file annual
reports and other information with the Securities and Exchange Commission. We will file annual reports on Form 20-F and submit
other information under cover of Form 6-K. As a foreign private issuer, we are exempt from the proxy requirements of Section 14
of the Exchange Act and our officers, directors and principal shareholders will be exempt from the insider short-swing disclosure
and profit recovery rules of Section 16 of the Exchange Act. Annual reports and other information we file with the Securities
and Exchange Commission may be inspected at the public reference facilities maintained by the Securities and Exchange Commission
at Room 1580, 100 F. Street, N.E., Washington, D.C. 20549, and copies of all or any part thereof may be obtained from such office
upon payment of the prescribed fees. You may call the Securities and Exchange Commission at 1-800-SEC-0330 for further information
on the operation of the public reference room and you can request copies of the documents upon payment of a duplicating fee, by
writing to the Securities and Exchange Commission. In addition, the Securities and Exchange Commission maintains a web site that
contains reports and other information regarding registrants (including us) that file electronically with the Securities and Exchange
Commission which can be assessed at http://www.sec.gov.



| | I. | Subsidiary
                                         Information
| | -- | ---------------------------------------------------------------



Not required.



| | ITEM 11. | QUANTITATIVE
                                         AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
| | -------- | --------------------------------------------------------------------------------------------------



We place temporary cash investments
with financial institutions and invest in those institutions and instruments that our management believes have minimal credit
risk and market risk.



| | ITEM 12. | DESCRIPTION
                                         OF SECURITIES OTHER THAN EQUITY SECURITIES
| | -------- | -----------------------------------------------------------------------------------------------



A description of our securities
other than equity securities is included under the heading “Description of Securities” in our registration statement
on Form F-1 (File No. 333-172334), initially filed with the Securities and Exchange Commission on February 18, 2011, as amended,
which description is incorporated herein by reference.



PART
II



Not required.



PART
III



| | ITEM 17. | FINANCIAL
                                         STATEMENTS
| | -------- | -------------------------------------------------------------



We have elected to provide financial
statements pursuant to Item 18.



11







| | ITEM 18. | FINANCIAL
                                         STATEMENTS
| | -------- | -------------------------------------------------------------



Prior to the Business Combination,
Lone Oak was a non-operating public shell corporation, having assets consisting solely of cash and nominal other assets. Arabella
was a private operating company. Upon consummation of the Business Combination, Arabella’s former members have voting and
management control of the combined company. In accordance with the guidance in the SEC’s Corporation Finance Financial Reporting
Manual section 12100.1, the acquisition of a private operating company by a non-operating public shell company is considered to
be a reverse recapitalization, equivalent to the issuance of stock by the private company for the net monetary assets of the shell
corporation accompanied by a recapitalization. Accordingly, the assets and liabilities and historical operations that are reflected
in the financial statements are those of Arabella and are recorded at the historical cost basis of Arabella. Lone Oak’s
assets, liabilities and results of operations will be consolidated with the assets, liabilities, and results of operations of
Arabella after consummation of acquisition. In accordance therewith, Arabella’s financial statements are included beginning
on page F-1.



The unaudited condensed combined
pro forma statements of operations for the six months ended June 30, 2013 and for the year ended December 31, 2012 give pro forma
effect to the acquisition as if it had occurred on January 1, 2013 or 2012, respectively. The unaudited condensed combined pro
forma balance sheet as of June 30, 2013 gives pro forma effect to the Business Combination as if it had occurred on such date.
The unaudited condensed combined pro forma statements of operations and balance sheet are based on the historical financial statements
of Arabella and Lone Oak for the six months ended June 30, 2013 and for the year ended December 31, 2012.



This information should be read
together with the financial statements of Arabella and the notes thereto, “Management’s Discussion and Analysis of
Financial Condition and Results of Operations of the Target Company,” included elsewhere in this Report.



The unaudited condensed combined
pro forma financial information is presented for informational purposes only and is subject to a number of uncertainties and assumptions
and do not purport to represent what the companies’ actual performance or financial position would have been had the transaction
occurred on the dates indicated and does not purport to indicate the financial position or results of operations as of any future
date or for any future period.



Lone Oak believes that the former
members of Arabella control the post-transaction company for the following reasons:



| | · | The Board of
                                         Directors of the post transaction company will be controlled by the former members of
                                         Arabella, and all of the executive officers will be members of the Arabella management
                                         team.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Although there
                                         are some limitations on the ability of the Board of Directors to act without the approval
                                         of non-Arabella designees to the Board of Directors, such limitations are discrete and
                                         in the nature of restrictions that a large investor would place on a company or that
                                         relate to the agreements made between Lone Oak and the members of Arabella. The non-Arabella
                                         designees to the Board of Directors otherwise have the same ability to influence the
                                         actions of the Board of Directors (such as selecting, terminating and setting compensation
                                         of management and establishing operating and capital budgets) as any other member of
                                         the Board of Directors, and, as is typical of members of the Board of Directors, would
                                         not be expected to participate in the ordinary course of business of the post-transaction
                                         company.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | A majority
                                         of the outstanding ordinary shares outstanding immediately after the transaction will
                                         be owned by the former members of Arabella.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



12







| | · | Even if all the
                                         warrants were exercised (whether on a cash or cashless basis), the persons subject to
                                         the voting agreement would own a majority of the outstanding ordinary shares of the combined
                                         company, meaning that, pursuant to the voting agreement, the former members of Arabella
                                         would retain control of the Board of Directors for at least four years (the term of the
                                         voting agreement), and, by extension, the management of the combined company.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Lone Oak’s outstanding
warrants are exercisable at $5.00 per share, and may, in certain circumstances, be exercised on a cashless basis. Except in unusual
circumstances, Lone Oak does not expect holders of the warrants to exercise the warrants until immediately prior to their expiration
or in the event of a call of the warrants. We can call the warrants, excluding warrants to purchase approximately 6.6 million
ordinary shares held by certain of our insiders,after our ordinary shares have traded at a price per share above $10.50 for 20
out of 30 trading days. Such a call would be in the discretion of our board of directors.





13







Lone Oak
and Arabella

Unaudited Proforma Consolidating Balance
Sheet

June 30, 2013



|                                                                                                                                                    |  | UnauditedBalance Sheet ofLone Oak at June30, 2013 |            |  | UnauditedBalance Sheet ofArabella at June30, 2013 |   |           | Proformaadjustments |  |   | UnauditedProformacombined |     
|--------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------------------------------- | ---------- |  | ------------------------------------------------- | - | --------- | ------------------- |  | - | ------------------------- | ----
|ASSETS                                                                                                                                              |  |                                                   |            |  |                                                   |   |           |                     |  |   |                           |     
|Current assets:                                                                                                                                     |  |                                                   |            |  |                                                   |   |           |                     |  |   |                           |     
|Cash and cash equivalents                                                                                                                           |  | $                                                 | 1,679,785  |  |                                                   | $ | 12,951    |                     |  | $ | 5,571,648                 | (1) 
|                                                                                                                                                    |  |                                                   |            |  |                                                   |   |           |                     |  |   | (214,423                  | )(6)
|                                                                                                                                                    |  |                                                   |            |  |                                                   |   |           |                     |  |   | (1,120,000                | )(4)
|                                                                                                                                                    |  |                                                   |            |  |                                                   |   |           |                     |  |   | (299,831                  | )(4)
|Accounts receivable - oil and gas sales                                                                                                             |  |                                                   | -          |  |                                                   |   | 27,266    |                     |  |   | -                         |     
|Prepaid expenses                                                                                                                                    |  |                                                   | -          |  |                                                   |   | -         |                     |  |   | -                         |     
|Total current assets                                                                                                                                |  |                                                   | 1,679,785  |  |                                                   |   | 40,217    |                     |  |   | 3,937,394                 |     
|                                                                                                                                                    |  |                                                   |            |  |                                                   |   |           |                     |  |   |                           |     
|Other Assets                                                                                                                                        |  |                                                   |            |  |                                                   |   |           |                     |  |   |                           |     
|Cash and cash equivalents held in trust                                                                                                             |  |                                                   | 9,345,773  |  |                                                   |   | -         |                     |  |   | (164,307                  | )(2)
|                                                                                                                                                    |  |                                                   |            |  |                                                   |   |           |                     |  |   | (3,609,818                | )(8)
|                                                                                                                                                    |  |                                                   |            |  |                                                   |   |           |                     |  |   | (5,571,648                | )(1)
|Oil and gas properties, successful
    efforts method                                                                                               |  |                                                   | -          |  |                                                   |   | 8,179,561 |                     |  |   | -                         |     
|Total other assets                                                                                                                                  |  |                                                   | 9,345,773  |  |                                                   |   | 8,179,561 |                     |  |   | (9,345,773                | )   
|Total assets                                                                                                                                        |  | $                                                 | 11,025,558 |  |                                                   | $ | 8,219,778 |                     |  | $ | (5,408,379                | )   
|                                                                                                                                                    |  |                                                   |            |  |                                                   |   |           |                     |  |   |                           |     
|LIABILITIES                                                                                                                                         |  |                                                   |            |  |                                                   |   |           |                     |  |   |                           |     
|Current liabilities:                                                                                                                                |  |                                                   |            |  |                                                   |   |           |                     |  |   |                           |     
|Accounts payable and accrued liabilities                                                                                                            |  | $                                                 | -          |  |                                                   | $ | 25,975    |                     |  | $ | -                         |     
|Accrued joint interest billings
    payable                                                                                                         |  |                                                   | -          |  |                                                   |   | 268,062   |                     |  |   | -                         |     
|Total  current
    liabilities                                                                                                                      |  |                                                   | -          |  |                                                   |   | 294,037   |                     |  |   | -                         |     
|Other liabilities:                                                                                                                                  |  |                                                   |            |  |                                                   |   |           |                     |  |   |                           |     
|Loans due to sole member                                                                                                                            |  |                                                   | -          |  |                                                   |   | 7,422,020 |                     |  |   | (3,711,010                | )(7)
|Asset retirement obligation                                                                                                                         |  |                                                   | -          |  |                                                   |   | 5,631     |                     |  |   | -                         |     
|Total long term liabilities                                                                                                                         |  |                                                   | -          |  |                                                   |   | 7,427,651 |                     |  |   | (3,711,010                | )   
|Total liabilities                                                                                                                                   |  |                                                   | -          |  |                                                   |   | 7,721,688 |                     |  |   | (3,711,010                | )   
|                                                                                                                                                    |  |                                                   |            |  |                                                   |   |           |                     |  |   |                           |     
|Commitments:                                                                                                                                        |  |                                                   |            |  |                                                   |   |           |                     |  |   |                           |     
|Ordinary shares, subject
    to redemption, 525,636 and 2,829,535 shares at redemption value                                                        |  |                                                   | 4,318,275  |  |                                                   |   | -         |                     |  |   | (164,307                  | )(2)
|                                                                                                                                                    |  |                                                   |            |  |                                                   |   |           |                     |  |   | (4,153,968                | )(8)
|                                                                                                                                                    |  |                                                   |            |  |                                                   |   |           |                     |  |   |                           |     
|MEMBERS' EQUITY                                                                                                                                     |  |                                                   |            |  |                                                   |   |           |                     |  |   |                           |     
|Preferred shares, $0.001
    par value Authorized 5,000,000 shares; issued and outstanding none                                                     |  |                                                   | -          |  |                                                   |   | -         |                     |  |   | -                         |     
|Ordinary shares, $0.001
    par value Authorized 50,000,000 shares; issued and outstanding 1,638,590 (which excludes 525,636 subject to redemption) |  |                                                   | 1,639      |  |                                                   |   | -         |                     |  |   | 4,830                     | (9) 
|                                                                                                                                                    |  |                                                   |            |  |                                                   |   |           |                     |  |   |                           |     
|Additional paid-in capital                                                                                                                          |  |                                                   | 5,174,241  |  |                                                   |   |           |                     |  |   | 1,531,403                 | (5) 
|                                                                                                                                                    |  |                                                   |            |  |                                                   |   |           |                     |  |   | 3,711,010                 | (7) 
|                                                                                                                                                    |  |                                                   |            |  |                                                   |   |           |                     |  |   | 544,150                   | (8) 
|                                                                                                                                                    |  |                                                   |            |  |                                                   |   |           |                     |  |   | 197,678                   | (9) 
|                                                                                                                                                    |  |                                                   |            |  |                                                   |   |           |                     |  |   | (500                      | )(9)
|                                                                                                                                                    |  |                                                   |            |  |                                                   |   |           |                     |  |   | (4,830                    | )(9)
|Accumulated earnings (deficit)
    during the development stage                                                                                     |  |                                                   | 1,531,403  |  |                                                   |   | -         |                     |  |   | (1,531,403                | )(5)
|Member contributions                                                                                                                                |  |                                                   | -          |  |                                                   |   | 197,678   |                     |  |   | (197,678                  | )(9)
|Distributions to members                                                                                                                            |  |                                                   | -          |  |                                                   |   | (500      | )                   |  |   | 500                       | (9) 
|Retained earnings                                                                                                                                   |  |                                                   | -          |  |                                                   |   | 300,912   |                     |  |   | (214,423                  | )(6)
|                                                                                                                                                    |  |                                                   | -          |  |                                                   |   | -         |                     |  |   | (1,120,000                | )(4)
|                                                                                                                                                    |  |                                                   | -          |  |                                                   |   | -         |                     |  |   | (299,831                  | )(4)
|Total members' equity                                                                                                                               |  |                                                   | 6,707,283  |  |                                                   |   | 498,090   |                     |  |   | 2,620,906                 |     
|Total liabilities and
    members' equity                                                                                                           |  | $                                                 | 11,025,558 |  |                                                   | $ | 8,219,778 |                     |  | $ | (5,408,379                | )   



|(1) | Reflects the release of Lone Oak’s cash held in trust,
    and the transfer of the balance to cash and cash equivalents at the completion of the Transaction. On December 24, 2013, 439,400
    shares were tendered, as a result, $5,571,647 is transferred to cash with the balance paid to redeeming shareholders.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Reflects the subsequent redemption on September 19, 2013 by Lone Oak of 20,000
    shares for approximately $8.21 through a previous, unrelated tender offer in conjunction with Lone Oak’s request for
    an extension of its time to complete a merger.                                                           
|(3) | To remove other income.                                                                                                                                                                                                                                                                                              
|(4) | Payment of additional expenses associated with the Transaction including $1,120,000
    due to EarlyBird Capital as well as $299,831 for other expenses.                                                                                                                                                             
|(5) | Elimination of Lone Oak's accumulated earnings.                                                                                                                                                                                                                                                                      
|(6) | Reflects the payment of special dividend by Lone Oak on October 24, 2013 to
    ordinary shareholders, on 2,144,226 shares outstanding as of October 14, 2013, of $0.10 per ordinary share.                                                                                                                          
|(7) | Reflects the conversion of one half of Arabella's note to its sole member
    into equity as part of the Merger. The other half of the note will remain as a long term liability of the combined companies.                                                                                                          
|(8) | Recognition of the 45.2% of ordinary shares, or 505,636 shares, available
    for redemption prior to the merger with 439,400 shares redeemed and 66,236 transferred to Members’ Equity.                                                                                                                             
|(9) | Recognition of issuance of 4,830,002 ordinary shares to Arabella's members
    as merger consideration and elimination of Arabella's equity.                                                                                                                                                                         



14







Lone Oak
and Arabella

Unaudited Proforma Consolidating Statement
of Operations

For the Six Months Ended June 30, 2013



|                                                                               |  | UnauditedStatement ofOperations of LoneOak for the sixmonths ended June30, 2013 |           |   | UnauditedStatement ofOperations ofArabella for the sixmonths ended June30, 2013 |   |         | Proformaadjustments |  |   | UnauditedProformacombined | 
|------------------------------------------------------------------------------ |  | ------------------------------------------------------------------------------- | --------- | - | ------------------------------------------------------------------------------- | - | ------- | ------------------- |  | - | ------------------------- | 
|                                                                               |  |                                                                                 |           |   |                                                                                 |   |         |                     |  |   |                           | 
|Revenues                                                                       |  |                                                                                 |           |   |                                                                                 |   |         |                     |  |   |                           | 
|Oil
    and gas revenue                                                        |  | $                                                                               | -         |   |                                                                                 | $ | 114,444 |                     |  | $ | -                         | 
|                                                                               |  |                                                                                 |           |   |                                                                                 |   |         |                     |  |   |                           | 
|Total
    revenues and support                                                 |  |                                                                                 | -         |   |                                                                                 |   | 114,444 |                     |  |   | -                         | 
|                                                                               |  |                                                                                 |           |   |                                                                                 |   |         |                     |  |   |                           | 
|Costs and Expenses                                                             |  |                                                                                 |           |   |                                                                                 |   |         |                     |  |   |                           | 
|Lease operating expenses                                                       |  |                                                                                 | -         |   |                                                                                 |   | 11,004  |                     |  |   | -                         | 
|Production taxes                                                               |  |                                                                                 | -         |   |                                                                                 |   | 5,493   |                     |  |   | -                         | 
|Depreciation,
    depletion and amortization                                   |  |                                                                                 | -         |   |                                                                                 |   | 45,697  |                     |  |   | -                         | 
|Accretion of asset retirement
    obligation                                   |  |                                                                                 | -         |   |                                                                                 |   | 198     |                     |  |   | -                         | 
|General administrative expenses                                                |  |                                                                                 | -         |   |                                                                                 |   | 5,036   |                     |  |   | -                         | 
|General
    administrative expenses allocated from Arabella Production Company |  |                                                                                 | -         |   |                                                                                 |   | 65,955  |                     |  |   | -                         | 
|Travel and entertainment                                                       |  |                                                                                 | 17,229    |   |                                                                                 |   | -       |                     |  |   | -                         | 
|Rent expense - related party                                                   |  |                                                                                 | 45,000    |   |                                                                                 |   | -       |                     |  |   | -                         | 
|Insurance expense                                                              |  |                                                                                 | 20,205    |   |                                                                                 |   | -       |                     |  |   | -                         | 
|Legal expense                                                                  |  |                                                                                 | 68,047    |   |                                                                                 |   | -       |                     |  |   | -                         | 
|General and
    Administrative expenses                                        |  |                                                                                 | 76,617    |   |                                                                                 |   | -       |                     |  |   | -                         | 
|                                                                               |  |                                                                                 |           |   |                                                                                 |   |         |                     |  |   |                           | 
|Total
    costs and expenses                                                   |  |                                                                                 | 227,098   |   |                                                                                 |   | 133,383 |                     |  |   | -                         | 
|                                                                               |  |                                                                                 |           |   |                                                                                 |   |         |                     |  |   |                           | 
|Net
    income (loss)                                                          |  | $                                                                               | (227,098  | ) |                                                                                 | $ | (18,939 | )                   |  | $ | -                         | 
|                                                                               |  |                                                                                 |           |   |                                                                                 |   |         |                     |  |   |                           | 
|Weighted
    average shares outstanding - basic and diluted                    |  |                                                                                 | 1,638,590 |   |                                                                                 |   |         |                     |  |   | 4,896,238                 | 
|                                                                               |  |                                                                                 |           |   |                                                                                 |   |         |                     |  |   |                           | 
|Basic
    and diluted net income (loss) per share                              |  | $                                                                               | (0.14     | ) |                                                                                 |   |         |                     |  |   |                           | 



15







Lone Oak
and Arabella

Audited Proforma Consolidating Statement
of Operations

for the Year Ended December 31, 2012



|                                                                               |  | AuditedStatement ofOperations of LoneOak for the yearended December 31,2012 |           |  | AuditedStatement ofOperations of Arabellafor the year endedDecember 31, 2012 |   |         | Proformaadjustments |  |   | UnauditedProformacombined |     
|------------------------------------------------------------------------------ |  | --------------------------------------------------------------------------- | --------- |  | ---------------------------------------------------------------------------- | - | ------- | ------------------- |  | - | ------------------------- | ----
|                                                                               |  |                                                                             |           |  |                                                                              |   |         |                     |  |   |                           |     
|Revenues                                                                       |  |                                                                             |           |  |                                                                              |   |         |                     |  |   |                           |     
|Oil
    and gas revenue                                                        |  | $                                                                           | -         |  |                                                                              | $ | 65,881  |                     |  | $ | -                         |     
|Other operating
    revenue - gain on sale of oil and gas properties           |  |                                                                             | -         |  |                                                                              |   | 402,901 |                     |  |   | -                         |     
|Other                                                                          |  |                                                                             | 2,500,000 |  |                                                                              |   | -       |                     |  |   | (2,500,000                | )(3)
|                                                                               |  |                                                                             |           |  |                                                                              |   |         |                     |  |   |                           |     
|Total
    revenues and support                                                 |  |                                                                             | 2,500,000 |  |                                                                              |   | 468,782 |                     |  |   | (2,500,000                | )   
|                                                                               |  |                                                                             |           |  |                                                                              |   |         |                     |  |   |                           |     
|Costs
    and Expenses                                                         |  |                                                                             |           |  |                                                                              |   |         |                     |  |   |                           |     
|Lease operating expenses                                                       |  |                                                                             | -         |  |                                                                              |   | 12,526  |                     |  |   | -                         |     
|Ad valorem and production taxes                                                |  |                                                                             | -         |  |                                                                              |   | 3,174   |                     |  |   | -                         |     
|Depreciation,
    depletion and amortization                                   |  |                                                                             | -         |  |                                                                              |   | 27,696  |                     |  |   | -                         |     
|Accretion of asset retirement
    obligation                                   |  |                                                                             | -         |  |                                                                              |   | 215     |                     |  |   | -                         |     
|General administrative expenses                                                |  |                                                                             | -         |  |                                                                              |   | 10,010  |                     |  |   | -                         |     
|General
    administrative expenses allocated from Arabella Production Company |  |                                                                             | -         |  |                                                                              |   | 93,845  |                     |  |   | -                         |     
|Travel and entertainment                                                       |  |                                                                             | 2,669     |  |                                                                              |   | -       |                     |  |   | -                         |     
|Rent expense - related party                                                   |  |                                                                             | 90,000    |  |                                                                              |   | -       |                     |  |   | -                         |     
|Insurance expense                                                              |  |                                                                             | 55,799    |  |                                                                              |   | -       |                     |  |   | -                         |     
|Legal expense                                                                  |  |                                                                             | 106,131   |  |                                                                              |   | -       |                     |  |   | -                         |     
|General
    and Administrative expenses                                        |  |                                                                             | 42,357    |  |                                                                              |   | -       |                     |  |   | -                         |     
|Interest expense                                                               |  |                                                                             | 3,265     |  |                                                                              |   | -       |                     |  |   | -                         |     
|                                                                               |  |                                                                             |           |  |                                                                              |   |         |                     |  |   |                           |     
|Total
    costs and expenses                                                   |  |                                                                             | 300,221   |  |                                                                              |   | 147,466 |                     |  |   | -                         |     
|                                                                               |  |                                                                             |           |  |                                                                              |   |         |                     |  |   |                           |     
|Net
    income (loss)                                                          |  | $                                                                           | 2,199,779 |  |                                                                              | $ | 321,316 |                     |  | $ | (2,500,000                | )   
|                                                                               |  |                                                                             |           |  |                                                                              |   |         |                     |  |   |                           |     
|Weighted
    average shares outstanding - basic and diluted                    |  |                                                                             | 1,638,590 |  |                                                                              |   |         |                     |  |   | 4,896,238                 |     
|                                                                               |  |                                                                             |           |  |                                                                              |   |         |                     |  |   |                           |     
|Basic
    and diluted net income (loss) per share                              |  | $                                                                           | 1.34      |  |                                                                              |   |         |                     |  |   |                           |     



16







SELECTED UNAUDITED CONDENSED COMBINED
PRO FORMA

FINANCIAL INFORMATION



The selected unaudited condensed combined
pro forma financial information has been derived from, and should be read in conjunction with, the unaudited condensed combined
pro forma financial information included elsewhere in this Report.



The acquisition will be accounted for
as a “reverse merger” and recapitalization since the shareholder of Arabella will (i) own a majority of the outstanding
ordinary shares of Lone Oak immediately following the completion of the transaction, and (ii) have the significant influence and
the ability to elect or appoint or to remove a majority of the members of the governing body of the combined entity, and Arabella’s
senior management will dominate the management of the combined entity immediately following the completion of the transaction
in accordance with the provision of Financial Accounting Standards Board Accounting Standards Codification (“FASB-ASC”)
topic 805 Business Combinations. Accordingly, Arabella will be deemed to be the accounting acquirer in the transaction and, consequently,
the transaction is treated as a recapitalization of Arabella. Accordingly, the assets and liabilities and the historical operations
that are reflected in the financial statements are those of Arabella and are recorded at the historical cost basis of Arabella.
Lone Oak’s assets, liabilities and results of operations will be consolidated with the assets, liabilities and results of
operations of Arabella after consummation of the acquisition.



The unaudited condensed combined pro forma
balance sheet as of June 30, 2013 gives pro forma effect to the acquisition as if it had occurred on such date. The unaudited
condensed combined pro forma statements of operations for the six months ended June 30, 2013 and for the year ended December 31,
2012 give pro forma effect to the acquisition as if it had occurred on January 1, 2013 or 2012, respectively.



The historical financial information has
been adjusted to give effect to pro forma events that are related and/or directly attributable to the acquisition, are factually
supportable and, in the case of the unaudited pro forma statement of operations data, are expected to have continuing impact on
the combined results. The adjustments presented on the unaudited condensed combined pro forma financial information have been
identified and presented in “Unaudited Condensed Combined Pro Forma Financial Data” to provide relevant information
necessary for an accurate understanding of the combined company upon consummation of the acquisition.



This information should be read together
with the financial statements of Arabella Exploration and the notes thereto, “Unaudited Condensed Combined Pro Forma Financial
Information,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations of
the Target Company,” included elsewhere in this Report.



17







The unaudited condensed combined pro forma
financial information is presented for informational purposes only and is subject to a number of uncertainties and assumptions
and does not purport to represent what the companies’ actual performance or financial position would have been had the transaction
occurred on the dates indicated and does not purport to indicate the financial position or results of operations as of any future
date or for any future period.



18







Lone Oak
and Arabella

Selected Unaudited Condensed Proforma
Consolidating Balance Sheet

June 30, 2013



|                                            |  | UnauditedBalance Sheet ofLone Oak at June30, 2013 |            |  | UnauditedBalance Sheet ofArabella at June30, 2013 |   |           | Proformaadjustments |  |   | UnauditedProformacombined |  
|------------------------------------------- |  | ------------------------------------------------- | ---------- |  | ------------------------------------------------- | - | --------- | ------------------- |  | - | ------------------------- | -
|                                            |  |                                                   |            |  |                                                   |   |           |                     |  |   |                           |  
|Current assets                              |  | $                                                 | 1,679,785  |  |                                                   | $ | 40,217    |                     |  | $ | 3,937,394                 |  
|Other Assets                                |  |                                                   | 9,345,773  |  |                                                   |   | 8,179,561 |                     |  |   | (9,345,773                | )
|Total Assets                                |  | $                                                 | 11,025,558 |  |                                                   | $ | 8,219,778 |                     |  | $ | (5,408,379                | )
|Current liabilities                         |  |                                                   | -          |  |                                                   |   | 294,037   |                     |  |   | -                         |  
|Other liabilities                           |  |                                                   | -          |  |                                                   |   | 7,427,651 |                     |  |   | (3,711,010                | )
|Total liabilities                           |  |                                                   | -          |  |                                                   |   | 7,721,688 |                     |  |   | (3,711,010                | )
|Common stock subject to possible redemption |  |                                                   | 4,318,275  |  |                                                   |   | -         |                     |  |   | (4,318,275                | )
|Total member's equity                       |  |                                                   | 6,707,283  |  |                                                   |   | 498,090   |                     |  |   | 2,620,906                 |  
|Total liabilities and member's
    equity   |  | $                                                 | 11,025,558 |  |                                                   | $ | 8,219,778 |                     |  | $ | (5,408,379                | )



19







Lone Oak
and Arabella

Selected Unaudited Condensed Proforma
Consolidating Statement of Operations

For the Six Months Ended June 30, 2013



|                                                            |  | UnauditedStatement ofOperations of LoneOak for the sixmonths ended June30, 2013 |           |   | UnauditedStatement ofOperations ofArabella for the sixmonths ended June30, 2013 |   |         | Proformaadjustments |  |   | UnauditedProformacombined | 
|----------------------------------------------------------- |  | ------------------------------------------------------------------------------- | --------- | - | ------------------------------------------------------------------------------- | - | ------- | ------------------- |  | - | ------------------------- | 
|                                                            |  |                                                                                 |           |   |                                                                                 |   |         |                     |  |   |                           | 
|Total
    Revenues                                          |  | $                                                                               | -         |   |                                                                                 | $ | 114,444 |                     |  | $ | -                         | 
|Total
    Expenses                                          |  |                                                                                 | 227,098   |   |                                                                                 |   | 133,383 |                     |  |   | -                         | 
|Net Income (Loss)                                           |  |                                                                                 | (227,098  | ) |                                                                                 |   | (18,939 | )                   |  |   | -                         | 
|                                                            |  |                                                                                 |           |   |                                                                                 |   |         |                     |  |   |                           | 
|Weighted
    average shares outstanding - basic and diluted |  |                                                                                 | 1,638,590 |   |                                                                                 |   | -       |                     |  |   | 4,896,238                 | 
|Basic
    and diluted net income (loss) per share           |  | $                                                                               | (0.14     | ) |                                                                                 | $ | -       |                     |  |   |                           | 



20







Lone Oak
and Arabella

Selected Unaudited Condensed Proforma
Consolidating Statement of Operations

for the Year Ended December 31, 2012



|                                                            |  | AuditedStatement ofOperations of LoneOak for the yearended December31, 2012 |           |  | AuditedStatement ofOperations ofArabella for theyear endedDecember 31, 2012 |   |         | Proformaadjustments |  |   | UnauditedProformacombined |  
|----------------------------------------------------------- |  | --------------------------------------------------------------------------- | --------- |  | --------------------------------------------------------------------------- | - | ------- | ------------------- |  | - | ------------------------- | -
|                                                            |  |                                                                             |           |  |                                                                             |   |         |                     |  |   |                           |  
|Total Revenues                                              |  | $                                                                           | 2,500,000 |  |                                                                             | $ | 468,782 |                     |  | $ | (2,500,000                | )
|Total Expenses                                              |  |                                                                             | 300,221   |  |                                                                             |   | 147,466 |                     |  |   | -                         |  
|Net Income (Loss)                                           |  |                                                                             | 2,199,779 |  |                                                                             |   | 321,316 |                     |  |   | (2,500,000                | )
|                                                            |  |                                                                             |           |  |                                                                             |   |         |                     |  |   |                           |  
|Weighted average shares outstanding
    - basic and diluted |  |                                                                             | 1,638,590 |  |                                                                             |   | -       |                     |  |   | 4,896,238                 |  
|Basic and
    diluted net income (loss) per share           |  | $                                                                           | 1.34      |  |                                                                             | $ | -       |                     |  |   |                           |  



21









Lone
Oak and Arabella



Supplemental
Oil and Gas Reserve Information



Fiscal years 2011 and 2012



The following table sets forth estimated
proved reserves together with the changes therein (Oil and NGL in Bbls, gas in Mcf, gas converted to BOE by dividing Mcf by six)
for the year ended December 31, 2012, giving effect to reserves associated with properties owned by Petroleum during the period
and transferred to Arabella in 2013:



|                                                          |  | Oil |         |   | Gas |  |         | BOE | 
|--------------------------------------------------------- |  | --- | ------- | - | --- |  | ------- | --- | 
|                                                          |  |     |         |   |     |  |         |     | 
|Balance at December 31, 2010                              |  |     | -       |   |     |  | -       |     | 
|                                                          |  |     |         |   |     |  |         |     | 
|Purchase and assignment of minerals in place, as restated |  |     | 13,720  |   |     |  | -       |     | 
|                                                          |  |     |         |   |     |  |         |     | 
|Balance at December 31, 2011, as restated                 |  |     | 13,720  |   |     |  | -       |     | 
|                                                          |  |     |         |   |     |  |         |     | 
|Purchase and assignment of minerals in place, as restated |  |     | 153,280 |   |     |  | 378,511 |     | 
|Production                                                |  |     | (679    | ) |     |  | (1,338  | )   | 
|                                                          |  |     |         |   |     |  |         |     | 
|Balance at December 31, 2012, as restated                 |  |     | 166,321 |   |     |  | 377,173 |     | 



The standardized measure
of discounted future net cash flows relating to estimated proved reserves as of December 31, 2012 and 2011, giving effect to reserves
associated with properties owned by Petroleum during the period and transferred to Arabella in 2013, was as follows (In thousands):



|                                                  |  | 2012       |        |   | 2011       |  
|------------------------------------------------- |  | ---------- | ------ | - | ---------- | -
|                                                  |  | (Restated) |        |   | (Restated) |  
|                                                  |  |            |        |   |            |  
|Future cash inflows                               |  | $          | 17,034 |   |            | $
|Future costs:                                     |  |            |        |   |            |  
|Production                                        |  |            | (4,326 | ) |            |  
|Development                                       |  |            | (5,761 | ) |            |  
|                                                  |  |            |        |   |            |  
|Future net cash inflows                           |  |            | 6,947  |   |            |  
|10% discount factor                               |  |            | (4,286 | ) |            |  
|                                                  |  |            |        |   |            |  
|Standardized measure of discounted net cash flows |  | $          | 2,661  |   |            | $



22







Changes in the standardized
measure of discounted future net cash flows relating to estimated proved reserves for the year ended December 31, 2012, giving
effect to reserves associated with properties owned by Petroleum during the period and transferred to Arabella in 2013, were as
follows (In thousands):



|                                               |  | 2012       |       |   | 2011       |  
|---------------------------------------------- |  | ---------- | ----- | - | ---------- | -
|                                               |  | (Restated) |       |   | (Restated) |  
|                                               |  |            |       |   |            |  
|Standardized measure at beginning of period    |  | $          | 94    |   |            | $
|                                               |  |            |       |   |            |  
|Sales, net of production costs                 |  |            | (50   | ) |            |  
|Purchases and assignments of minerals in place |  |            | 2,617 |   |            |  
|                                               |  |            |       |   |            |  
|Standardized measure at end of period          |  | $          | 2,661 |   |            | $



The estimated present value
of future cash flows relating to estimated proved reserves is extremely sensitive to prices used at any measurement period. The
average prices used for each commodity for the year ended December 31, 2012 was as follows:



|                  |  | Average Price |      
|----------------- |  | ------------- | -----
|                  |  | Oil           |      
|                  |  |               |      
|December 31, 2012 |  | $             | 89.14



Average
prices for December 31, 2012 were based on the 12-month un-weighted arithmetic average of the first-day-of-the-month price for
the period from January through December during each respective calendar year.



Analysis of Reserves



The following table presents
Arabella’s estimated net proved oil and natural gas reserves and the present value of Arabella’s reserves as of December
31, 2012 and 2011, based on the reserve report prepared by WPC, and such reserve reports have been prepared in accordance with
the rules and regulations of the SEC. All Arabella’s proved reserves included in the reserve reports are located in North
America.



23







|                                        |  | Historical(1) |         |   | Restated (2) | 
|--------------------------------------- |  | ------------- | ------- | - | ------------ | 
|                                        |  | December 31,  |         |   | December 31, | 
|                                        |  | 2012          |         |   | 2011         | 
|                                        |  |               |         |   |              | 
|Estimated proved developed reserves:    |  |               |         |   |              | 
|Oil (MBbls)                             |  |               | 7.7     |   |              | 
|Natural gas (MMcf)                      |  |               | 6.4     |   |              | 
|Natural gas liquids (MBbls)             |  |               | -       |   |              | 
|Total (MBOE)                            |  |               | 8.8     |   |              | 
|Estimated proved undeveloped reserves:  |  |               |         |   |              | 
|Oil (MBbls)                             |  |               | 158.6   |   |              | 
|Natural gas (MMcf)                      |  |               | 370.8   |   |              | 
|Natural gas liquids (MBbls)             |  |               | -       |   |              | 
|Total (MBOE)                            |  |               | 222.1   |   |              | 
|Estimated net proved reserves:          |  |               |         |   |              | 
|Oil (MBbls)                             |  |               | 166.3   |   |              | 
|Natural gas (MMcf)                      |  |               | 377.2   |   |              | 
|Natural gas liquids (MBbls)             |  |               | -       |   |              | 
|Total (MBOE)                            |  |               | 229.2   |   |              | 
|Percent proved developed                |  |               | 3.8     | % |              | 
|                                        |  |               |         |   |              | 
|Estimated probable developed reserves   |  |               |         |   |              | 
|Oil (MBbls)                             |  |               | -       |   |              | 
|Natural gas (MMCF)                      |  |               | -       |   |              | 
|Natural gas liquids (MBbls)             |  |               | -       |   |              | 
|Total (MBOE)                            |  |               | -       |   |              | 
|Estimated probable undeveloped reserves |  |               |         |   |              | 
|Oil (MBbls)                             |  |               | 1,414.8 |   |              | 
|Natural gas (MMCF)                      |  |               | 1,980.7 |   |              | 
|Natural gas liquids (MBbls)             |  |               | -       |   |              | 
|Total (MBOE)                            |  |               | 1,744.9 |   |              | 
|                                        |  |               |         |   |              | 
|Estimated possible developed reserves   |  |               |         |   |              | 
|Oil (MBls)                              |  |               | -       |   |              | 
|Natural gas (MMCF)                      |  |               | -       |   |              | 
|Natural gas liquids (MBbls)             |  |               | -       |   |              | 
|Total (MBOE)                            |  |               | -       |   |              | 
|Estimated possible undeveloped reserves |  |               |         |   |              | 
|Oil (MBls)                              |  |               | 297.9   |   |              | 
|Natural gas (MMCF)                      |  |               | 417.1   |   |              | 
|Natural gas liquids (MBbls)             |  |               | -       |   |              | 
|Total (MBOE)                            |  |               | 367.4   |   |              | 



(1) Estimates of reserves as of December 31,
2012 and 2011 and June 30, 2013 were prepared using an average price equal to the unweighted arithmetic average of hydrocarbon
prices received on a field-by-field basis on the first day of each month within the 12-month periods ended December 31, 2012 and
2011 and June 30, 2013, respectively, in accordance with revised SEC guidelines applicable to reserves estimates as of the end
of such periods. Reserve estimates do not include any value for probable or possible reserves that may exist, nor do they include
any value for undeveloped acreage. The reserve estimates represent Arabella’s net revenue interest in Arabella’s properties.
Although Arabella believes these estimates are reasonable, actual future production, cash flows, taxes, development expenditures,
operating expenses and quantities of recoverable oil and natural gas reserves may vary substantially from these estimates.



(2) The reserves at December
31, 2012 and 2011 have been restated, giving effect to reserves associated with properties owned by Petroleum during the period
and transferred to us in 2012 and 2013.



24







The foregoing reserves are
all located within the continental United States. Reserve engineering is a subjective process of estimating volumes of economically
recoverable oil and natural gas that cannot be measured in an exact manner. The accuracy of any reserve estimate is a function
of the quality of available data and of engineering and geological interpretation. As a result, the estimates of different engineers
often vary. In addition, the results of drilling, testing and production may justify revisions of such estimates. Accordingly,
reserve estimates often differ from the quantities of oil and natural gas that are ultimately recovered. Estimates of economically
recoverable oil and natural gas and of future net revenues are based on a number of variables and assumptions, all of which may
vary from actual results, including geologic interpretation, prices and future production rates and costs. Arabella has not filed
any estimates of total, proved net oil or natural gas reserves with any federal authority or agency other than the SEC.



(3) Gives effect to the
properties Petroleum acquired and transferred to Arabella in 2013.



Six months ended June
30, 2013



The below reserve information
and the standardized measures are as of June 30, 2013 and August 31, 2013, and do not include the properties under common control
that were transferred from Mr. Hoisager and Petroleum on or after September 1, 2013. These properties were included in the June
30, 2013 combined financial statements at their historical cost of $832,379. However, since there is no reserve report for such
properties, no information relating to reserves for such properties has been included in the pro-formas or elsewhere in the Offer
Letter. Lone Oak has no reserves of its own and, therefore, this information is the same as the information contained in the Arabella
financial statements.



The
following table sets forth Arabella’s estimated proved reserves together with the changes therein (Oil and NGL in Bbls,
gas in Mcf, gas converted to BOE by dividing Mcf by six) for the year ended December 31, 2012 and for the six months ended June
30, 2013, giving effect to reserves associated with properties owned by Petroleum during the period and subsequently transferred
to Arabella:



|                                                          |  | Oil |         |   | Gas |  |         | BOE | 
|--------------------------------------------------------- |  | --- | ------- | - | --- |  | ------- | --- | 
|                                                          |  |     |         |   |     |  |         |     | 
|Balance at December 31, 2011, as restated                 |  |     | 13,720  |   |     |  | -       |     | 
|                                                          |  |     |         |   |     |  |         |     | 
|Purchase and assignment of minerals in place, as restated |  |     | 153,280 |   |     |  | 378,511 |     | 
|Production                                                |  |     | (679    | ) |     |  | (1,338  | )   | 
|                                                          |  |     |         |   |     |  |         |     | 
|Balance at December 31, 2012, as restated                 |  |     | 166,321 |   |     |  | 377,173 |     | 
|                                                          |  |     |         |   |     |  |         |     | 
|Purchase and assignment of minerals in place, as restated |  |     | 316,663 |   |     |  | 446,402 |     | 
|Change in pricing                                         |  |     | (33     | ) |     |  | -       |     | 
|Production                                                |  |     | (1,194  | ) |     |  | (2,411  | )   | 
|                                                          |  |     |         |   |     |  |         |     | 
|Balance at June 30, 2013                                  |  |     | 481,757 |   |     |  | 821,164 |     | 



25







The standardized measure
of discounted future net cash flows relating to estimated proved reserves as of June 30, 2013 and December 31, 2012, giving effect
to reserves associated with properties owned by Petroleum during the period and transferred to Arabella in 2013, was as follows
(In thousands):



|                                                  |  | June 30,   |         |   | December   |  
|------------------------------------------------- |  | ---------- | ------- | - | ---------- | -
|                                                  |  | 2013       |         |   | 31, 2012   |  
|                                                  |  | (Restated) |         |   | (Restated) |  
|                                                  |  |            |         |   |            |  
|Future cash inflows                               |  | $          | 45,393  |   |            | $
|Future costs:                                     |  |            |         |   |            |  
|Production                                        |  |            | (10,189 | ) |            |  
|Development                                       |  |            | (11,686 | ) |            |  
|                                                  |  |            |         |   |            |  
|Future net cash inflows                           |  |            | 23,518  |   |            |  
|10% discount factor                               |  |            | (14,208 | ) |            |  
|                                                  |  |            |         |   |            |  
|Standardized measure of discounted net cash flows |  | $          | 9,310   |   |            | $



Changes in the standardized
measure of discounted future net cash flows relating to estimated proved reserves for the six months ended June 30, 2013 and for
the year ended December 31, 2012, giving effect to reserves associated with properties owned by Petroleum during the period and
transferred to us in 2013, were as follows (In thousands):



|                                               |  | June 30,   |       |   | December   |  
|---------------------------------------------- |  | ---------- | ----- | - | ---------- | -
|                                               |  | 2013       |       |   | 31, 2012   |  
|                                               |  | (Restated) |       |   | (Restated) |  
|                                               |  |            |       |   |            |  
|Standardized measure at beginning of period    |  | $          | 2,661 |   |            | $
|                                               |  |            |       |   |            |  
|Sales, net of production costs                 |  |            | (97   | ) |            |  
|Purchases and assignments of minerals in place |  |            | 6,746 |   |            |  
|                                               |  |            |       |   |            |  
|Standardized measure at end of period          |  | $          | 9,310 |   |            | $



The estimated present value
of future cash flows relating to estimated proved reserves is extremely sensitive to prices used at any measurement period. The
average prices used for each commodity for the six months ended June 30, 2013 and for the year ended December 31, 2012 were as
follows:



|                  |  | Average Price |      
|----------------- |  | ------------- | -----
|                  |  | Oil           |      
|                  |  |               |      
|December 31, 2012 |  | $             | 89.14
|June 30, 2013     |  |               | 88.08



Average
prices for June 30, 2013 and December 31, 2012 were based on the 12-month un-weighted arithmetic average of the first-day-of-the-month
price for the previous twelve month periods to June 30, 2013 and December 31, 2012.



26







Analysis of Reserves



The following table presents
Arabella’s estimated net proved oil and natural gas reserves and the present value of Arabella’s reserves as of December
31, 2012 and June 30, 2013, based on the reserve report prepared by WPC, and such reserve reports have been prepared in accordance
with the rules and regulations of the SEC. All Arabella’s proved reserves included in the reserve reports are located in
North America.



|                                        |  | Historical(1) |         |   | Restated (2) | 
|--------------------------------------- |  | ------------- | ------- | - | ------------ | 
|                                        |  | June 30,      |         |   | December 31, | 
|                                        |  | 2013          |         |   | 2012         | 
|                                        |  |               |         |   |              | 
|Estimated proved developed reserves:    |  |               |         |   |              | 
|Oil (MBbls)                             |  |               | 113.1   |   |              | 
|Natural gas (MMcf)                      |  |               | 147.4   |   |              | 
|Natural gas liquids (MBbls)             |  |               | -       |   |              | 
|Total (MBOE)                            |  |               | 137.6   |   |              | 
|Estimated proved undeveloped reserves:  |  |               |         |   |              | 
|Oil (MBbls)                             |  |               | 368.6   |   |              | 
|Natural gas (MMcf)                      |  |               | 673.8   |   |              | 
|Natural gas liquids (MBbls)             |  |               | -       |   |              | 
|Total (MBOE)                            |  |               | 480.9   |   |              | 
|Estimated Net Proved Reserves:          |  |               |         |   |              | 
|Oil (MBbls)                             |  |               | 481.8   |   |              | 
|Natural gas (MMcf)                      |  |               | 821.2   |   |              | 
|Natural gas liquids (MBbls)             |  |               | -       |   |              | 
|Total (MBOE)                            |  |               | 618.6   |   |              | 
|Percent proved developed                |  |               | 22.2    | % |              | 
|                                        |  |               |         |   |              | 
|Estimated probable developed reserves   |  |               |         |   |              | 
|Oil (MBbls)                             |  |               | -       |   |              | 
|Natural gas (MMCF)                      |  |               | -       |   |              | 
|Natural gas liquids (MBbls)             |  |               | -       |   |              | 
|Total (MBOE)                            |  |               | -       |   |              | 
|Estimated probable undeveloped reserves |  |               |         |   |              | 
|Oil (MBbls)                             |  |               | 2,139.6 |   |              | 
|Natural gas (MMCF)                      |  |               | 2,995.5 |   |              | 
|Natural gas liquids (MBbls)             |  |               | -       |   |              | 
|Total (MBOE)                            |  |               | 2,638.9 |   |              | 
|                                        |  |               |         |   |              | 
|Estimated possible developed reserves   |  |               |         |   |              | 
|Oil (MBbls)                             |  |               | -       |   |              | 
|Natural gas (MMCF)                      |  |               | -       |   |              | 
|Natural gas liquids (MBbls)             |  |               | -       |   |              | 
|Total (MBOE)                            |  |               | -       |   |              | 
|Estimated possible undeveloped reserves |  |               |         |   |              | 
|Oil (MBls)                              |  |               | 4,636.4 |   |              | 
|Natural gas (MMCF)                      |  |               | 6,575.2 |   |              | 
|Natural gas liquids (MBbls)             |  |               | -       |   |              | 
|Total (MBOE)                            |  |               | 5,732.3 |   |              | 



27







| | (1) | Estimates of reserves as of
                                         December 31, 2012 and 2011 and through August 31, 2013 were prepared using an average
                                         price equal to the unweighted arithmetic average of hydrocarbon prices received on a
                                         field-by-field basis on the first day of each month within the 12-month periods ended
                                         December 31, 2012 and 2011 and through August 31, 2013, respectively, in accordance with
                                         revised SEC guidelines applicable to reserves estimates as of the end of such periods.
                                         Reserve estimates do not include any value for probable or possible reserves that may
                                         exist, nor do they include any value for undeveloped acreage. The reserve estimates represent
                                         Arabella’s net revenue interest in Arabella’s properties. Although Arabella
                                         believes these estimates are reasonable, actual future production, cash flows, taxes,
                                         development expenditures, operating expenses and quantities of recoverable oil and natural
                                         gas reserves may vary substantially from these estimates.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | The reserves at December 31,
                                         2012 and 2011 have been restated, giving effect to reserves associated with properties
                                         owned by Petroleum during the period and transferred to us in 2012 and 2013.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The foregoing reserves are
all located within the continental United States. Reserve engineering is a subjective process of estimating volumes of economically
recoverable oil and natural gas that cannot be measured in an exact manner. The accuracy of any reserve estimate is a function
of the quality of available data and of engineering and geological interpretation. As a result, the estimates of different engineers
often vary. In addition, the results of drilling, testing and production may justify revisions of such estimates. Accordingly,
reserve estimates often differ from the quantities of oil and natural gas that are ultimately recovered. Estimates of economically
recoverable oil and natural gas and of future net revenues are based on a number of variables and assumptions, all of which may
vary from actual results, including geologic interpretation, prices and future production rates and costs. Arabella has not filed
any estimates of total, proved net oil or natural gas reserves with any federal authority or agency other than the SEC.



The following table shows how our total
net proved reserves increased from December 31, 2012 to August 31, 2013.



|                       |  | Amount
    of increase |      
|---------------------- |  | ---------------------- | -----
|Method of Increase     |  | Oil
    (MBbls)        |      
|Production             |  |                        | 1.1  
|Acquisition            |  |                        | 148.3
|Extensions/Discoveries |  |                        | 314.3





28









| | ITEM 19. | EXHIBITS
| | -------- | --------



|Exhibit
                           No. |  | Description                                                                                                                                                                                                                                                                                                                              
|-------------------------------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|1.1                                    |  | Amended and Restated Articles of Association*                                                                                                                                                                                                                                                                                            
|2.1                                    |  | Specimen Unit Certificate*                                                                                                                                                                                                                                                                                                               
|2.2                                    |  | Specimen Ordinary Share Certificate*                                                                                                                                                                                                                                                                                                     
|2.3                                    |  | Specimen Warrant Certificate*                                                                                                                                                                                                                                                                                                            
|2.4                                    |  | Form of Unit Purchase Option*                                                                                                                                                                                                                                                                                                            
|4.1                                    |  | Form of Underwriting Agreement*                                                                                                                                                                                                                                                                                                          
|4.2                                    |  | Form of Warrant Agreement between Continental Stock Transfer & Trust Company and the
    Registrant*                                                                                                                                                                                                                                     
|4.3                                    |  | Form of Representative’s Unit Purchase Option*                                                                                                                                                                                                                                                                                           
|4.4                                    |  | Form of Share Escrow Agreement between the Registrant, Continental Stock Transfer &
    Trust Company and the Initial Shareholders*                                                                                                                                                                                                      
|4.5                                    |  | Form of Registration Rights Agreement among the Registrant and its Initial Shareholders*                                                                                                                                                                                                                                                 
|4.6                                    |  | Employment Agreement with Jason Hoisager, dated December 24, 2013                                                                                                                                                                                                                                                                        
|4.7                                    |  | Registration Rights Agreement among the Registrant and the former members of Arabella Exploration,
    Limited Liability Company dated December 24, 2013                                                                                                                                                                                 
|4.8                                    |  | Voting agreement among the Company and the security holders named therein dated December
    24, 2013                                                                                                                                                                                                                                    
|4.9                                    |  | Lock-up Agreement dated December 24, 2013                                                                                                                                                                                                                                                                                                
|4.10                                   |  | Agreement and Plan of Merger and Reorganization dated October 23, 2013 by and among Lone
    Oak Acquisition Corporation, a Cayman Islands company, Arabella Exploration Corp., a Delaware corporation, Arabella Exploration,
    LLC, a Texas limited liability company, and each of the Stockholders set forth on Schedule I thereto.**
|8.1                                    |  | List of Subsidiaries                                                                                                                                                                                                                                                                                                                     
|15.1                                   |  | Consent ofHam, Langston & Brezina,
    LLP                                                                                                                                                                                                                                                                                               



|*  | Incorporated by reference to the Registrant’s Registration Statement
    on Form F-1 (Commission File No. 333-172334).                                       
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------
|** | Incorporated by reference to the Registrant’s Report of Foreign Private Issuer on
    Form 6-K dated October 2013 and filed with the SEC on October 25, 2013.



29







SIGNATURES



The Registrant
hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the
undersigned to sign this report on its behalf.







|                  | Lone Oak Acquisition Corporation
|----------------- | --------------------------------
|                  |                                 
|December 31, 2013 | By:                             
|                  | Name:                           
|                  | Title:                          



30







ARABELLA
EXPLORATION, LIMITED LIABILITY COMPANY

UNAUDITED COMBINED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED JUNE 30, 2013
AND 2012



F-1







ARABELLA
EXPLORATION, LIMITED LIABILITY COMPANY

TABLE OF CONTENTS



|                                                                                                      |  | Page      
|----------------------------------------------------------------------------------------------------- |  | ----------
|                                                                                                      |  |           
|Unaudited Combined Financial Statements:                                                              |  |           
|                                                                                                      |  |           
|Combined Balance
    Sheets at June 30, 2013 (Unaudited) and December 31, 2012                        |  | F-3       
|                                                                                                      |  |           
|Unaudited Combined
    Statements of Operations for the six months ended June 30, 2013 and 2012       |  | F-4       
|                                                                                                      |  |           
|Unaudited Combined
    Statement of Changes in Members' Equity for the six months ended June 30, 2013 |  | F-5       
|                                                                                                      |  |           
|Unaudited Combined
    Statements of Cash Flows for the six months ended June 30, 2013 and 2012       |  | F-6       
|                                                                                                      |  |           
|Notes to Unaudited Combined Financial Statements                                                      |  | F-7 – F-15



F-2







ARABELLA
EXPLORATION, LIMITED LIABILITY COMPANY

COMBINED BALANCE SHEETS

JUNE 30, 2013 AND DECEMBER 31, 2012





|                                                          |  | June 30,    |           |   | December 31, |  
|--------------------------------------------------------- |  | ----------- | --------- | - | ------------ | -
|                                                          |  | 2013        |           |   | 2012         |  
|                                                          |  | (Unaudited) |           |   | (Restated)   |  
|                                                          |  | (Restated)  |           |   |              |  
|ASSETS                                                    |  |             |           |   |              |  
|                                                          |  |             |           |   |              |  
|Current assets:                                           |  |             |           |   |              |  
|Cash and cash equivalents                                 |  | $           | 12,951    |   |              | $
|Accounts receivable - oil and gas sales                   |  |             | 27,266    |   |              |  
|                                                          |  |             |           |   |              |  
|Total current assets                                      |  |             | 40,217    |   |              |  
|                                                          |  |             |           |   |              |  
|Prepaid drilling costs to Arabella Petroleum Company, LLC |  |             | -         |   |              |  
|Oil and gas properties, successful efforts method         |  |             | 8,179,561 |   |              |  
|                                                          |  |             |           |   |              |  
|Total assets                                              |  | $           | 8,219,778 |   |              | $
|                                                          |  |             |           |   |              |  
|LIABILITIES AND MEMBERS' EQUITY                           |  |             |           |   |              |  
|                                                          |  |             |           |   |              |  
|Current liabilities:                                      |  |             |           |   |              |  
|Accounts payable and accrued liabilities                  |  | $           | 25,975    |   |              | $
|Accrued joint interest billings payable                   |  |             | 268,062   |   |              |  
|                                                          |  |             |           |   |              |  
|Total current liabilities                                 |  |             | 294,037   |   |              |  
|                                                          |  |             |           |   |              |  
|Loans due to sole member                                  |  |             | 7,422,020 |   |              |  
|Asset retirement obligation                               |  |             | 5,631     |   |              |  
|                                                          |  |             |           |   |              |  
|Total liabilities                                         |  |             | 7,721,688 |   |              |  
|                                                          |  |             |           |   |              |  
|Commitments and contingencies                             |  |             |           |   |              |  
|                                                          |  |             |           |   |              |  
|Members' equity:                                          |  |             |           |   |              |  
|Member contributions                                      |  |             | 197,678   |   |              |  
|Distributions to members                                  |  |             | (500      | ) |              |  
|Retained earnings                                         |  |             | 300,912   |   |              |  
|                                                          |  |             |           |   |              |  
|Total members' equity                                     |  |             | 498,090   |   |              |  
|                                                          |  |             |           |   |              |  
|Total liabilities and members' equity                     |  | $           | 8,219,778 |   |              | $





See notes to unaudited financial statements



F-3







ARABELLA
EXPLORATION, LIMITED LIABILITY COMPANY

UNAUDITED COMBINED STATEMENTS OF OPERATIONS

FOR THE SIX MONTHS ENDED JUNE 30, 2013
AND 2012



|                                                                                       |  | 2013       |         |   | 2012       |  
|-------------------------------------------------------------------------------------- |  | ---------- | ------- | - | ---------- | -
|                                                                                       |  | (Restated) |         |   | (Restated) |  
|Revenues:                                                                              |  |            |         |   |            |  
|Oil and gas revenue                                                                    |  | $          | 114,444 |   |            | $
|Other operating revenue –
    gain on sale of oil and gas properties                   |  |            | -       |   |            |  
|                                                                                       |  |            |         |   |            |  
|Total revenues                                                                         |  |            | 114,444 |   |            |  
|                                                                                       |  |            |         |   |            |  
|Costs and expenses:                                                                    |  |            |         |   |            |  
|Lease operating expenses                                                               |  |            | 11,004  |   |            |  
|Production taxes                                                                       |  |            | 5,493   |   |            |  
|Depreciation, depletion and amortization                                               |  |            | 45,697  |   |            |  
|Accretion of asset retirement obligation                                               |  |            | 198     |   |            |  
|General and administrative expenses                                                    |  |            | 5,036   |   |            |  
|General and administrative expenses
    allocated from Arabella Petroleum Company, LLC |  |            | 65,955  |   |            |  
|                                                                                       |  |            |         |   |            |  
|Total costs and expenses                                                               |  |            | 133,383 |   |            |  
|                                                                                       |  |            |         |   |            |  
|Net loss                                                                               |  | $          | (18,939 | ) |            | $



See notes to unaudited financial statements



F-4







ARABELLA
EXPLORATION, LIMITED LIABILITY COMPANY

UNAUDITED COMBIMED STATEMENTS OF MEMBER’S
EQUITY

FOR THE SIX MONTHS ENDED JUNE 30, 2013



|                                                                             |  | Member        |         |  | Member        |   |      | Retained |  |   |         |  
|---------------------------------------------------------------------------- |  | ------------- | ------- |  | ------------- | - | ---- | -------- |  | - | ------- | -
|                                                                             |  | Contributions |         |  | Distributions |   |      | Earnings |  |   | Total   |  
|                                                                             |  |               |         |  |               |   |      |          |  |   |         |  
|Balance
    at December 31,2012, as restated                                 |  | $             | 129,061 |  |               | $ | (500 | )        |  | $ | 319,851 |  
|                                                                             |  |               |         |  |               |   |      |          |  |   |         |  
|Member contributions:                                                        |  |               |         |  |               |   |      |          |  |   |         |  
|Contribution recognized for allocated general and
    administrative expense |  |               | 65,955  |  |               |   | -    |          |  |   | -       |  
|Interest imputed on member loans                                             |  |               | 2,662   |  |               |   | -    |          |  |   | -       |  
|                                                                             |  |               |         |  |               |   |      |          |  |   |         |  
|Net loss, as restated                                                        |  |               | -       |  |               |   | -    |          |  |   | (18,939 | )
|                                                                             |  |               |         |  |               |   |      |          |  |   |         |  
|Balance at June 30, 2013 As restated                                         |  | $             | 197,678 |  |               | $ | (500 | )        |  | $ | 300,912 |  



See notes to unaudited financial statements



F-5







ARABELLA
EXPLORATION, LIMITED LIABILITY COMPANY

UNAUDITED COMBINED STATEMENTS OF CASH
FLOWS

FOR THE SIX MONTHS ENDED JUNE 30, 2013
AND 2012



|                                                                                            |  | 2013       |           |   | 2012       |  
|------------------------------------------------------------------------------------------- |  | ---------- | --------- | - | ---------- | -
|                                                                                            |  | (Restated) |           |   | (Restated) |  
|Cash flows from operating activities:                                                       |  |            |           |   |            |  
|Net income (loss)                                                                           |  | $          | (18,939   | ) |            | $
|Adjustments to reconcile net income to net cash used
    in operating activities:           |  |            |           |   |            |  
|Depreciation, depletion and amortization                                                    |  |            | 45,697    |   |            |  
|Accretion of asset retirement obligation                                                    |  |            | 198       |   |            |  
|Contribution recognized for allocated general and
    administrative expenses               |  |            | 65,955    |   |            |  
|Gain from sale of oil and gas properties                                                    |  |            | -         |   |            |  
|Changes in operating assets and liabilities:                                                |  |            |           |   |            |  
|Accounts receivable - oil and gas sales                                                     |  |            | (19,678   | ) |            |  
|Accounts payable and accrued
    liabilities                                                |  |            | (24,263   | ) |            |  
|                                                                                            |  |            |           |   |            |  
|Net cash provided from operating
    activities                                             |  |            | 48,970    |   |            |  
|                                                                                            |  |            |           |   |            |  
|Cash flows from investing activities:                                                       |  |            |           |   |            |  
|Additions to oil and gas properties                                                         |  |            | (71,009   | ) |            |  
|Proceeds from sale of oil and
    gas properties                                            |  |            | -         |   |            |  
|                                                                                            |  |            |           |   |            |  
|Net cash used in investing activities                                                       |  |            | (71,009   | ) |            |  
|                                                                                            |  |            |           |   |            |  
|Cash flows from financing activities:                                                       |  |            |           |   |            |  
|Proceeds from member loans                                                                  |  |            | 22,000    |   |            |  
|                                                                                            |  |            |           |   |            |  
|Net cash provided by financing
    activities                                               |  |            | 22,000    |   |            |  
|                                                                                            |  |            |           |   |            |  
|Net (decrease) increase in cash and cash equivalents                                        |  |            | (39       | ) |            |  
|                                                                                            |  |            |           |   |            |  
|Cash and cash equivalents at beginning
    of year                                          |  |            | 12,990    |   |            |  
|                                                                                            |  |            |           |   |            |  
|Cash and cash equivalents at
    end of year                                                |  | $          | 12,951    |   |            | $
|                                                                                            |  |            |           |   |            |  
|Non-cash investing and financing activities:                                                |  |            |           |   |            |  
|Addition to oil and gas properties
    through increase in member loan                      |  | $          | 6,095,237 |   |            | $
|Capitalized imputed interest
    expense contributed by sole member related to member loans |  | $          | 2,662     |   |            | $
|Increase in joint interest billings
    payable for additions to oil and gas properties     |  | $          | 256,062   |   |            | $



See notes to unaudited financial statements



F-6







ARABELLA
EXPLORATION, LIMITED LIABILITY COMPANY

NOTES TO UNAUDITED COMBINED FINANCIAL
STATEMENTS



| | 1. | NATURE OF BUSINESS, CRITICAL ACCOUNTING
                                         POLICIES AND PRESENTATION
| | -- | ----------------------------------------------------------------------------------------------------------



General



Arabella Exploration, Limited
Liability Company (the "Company” or "Arabella”) was formed in 2011, to acquire interests in low risk prospective
or currently producing oil and gas properties primarily in the Texas Permian Basin. The Company's business is affected by economic
conditions in the United States and by the cyclical nature of the petroleum industry.



Substantially all of our oil
and gas production is sold under short-term contracts which are market-sensitive. Accordingly, our results of operations and capital
resources are highly dependent upon prevailing market prices of, and demand for, oil and natural gas. These commodity prices are
subject to wide fluctuations and market uncertainties due to a variety of factors that are beyond our control. These factors include
the level of global supply and demand for oil and natural gas, market uncertainties, weather conditions, domestic governmental
regulations and taxes, political and economic conditions in oil producing countries, price and availability of alternative fuels,
and overall domestic and foreign economic conditions.



Combined Financial Statements



Our financial statements are
presented on a combined basis to include the related financial statements of Arabella Petroleum, LLC (“Petroleum”)
because the Company and Petroleum are under common control. The related financial statements of Petroleum include oil and gas
properties that were owned by Petroleum during the reporting periods and transferred to the Company. The transfers were non-cash
transactions in which the loan due to the sole member increased by the historical cost of the properties.. The transfers are accounted
for as if they took place at the later of January 1, 2011, or the date the properties were acquired by Petroleum in accordance
with Accounting Standards Codification (“ASC”) 805-50-45 issued by the Financial Accounting Standards Board (“FASB”).



Use of Estimates



The process of preparing financial
statements in conformity with accounting principles generally accepted in the United States of America ("GAAP") requires
management to make estimates and assumptions that affect reported amounts of certain assets, liabilities, revenues and expenses.
We believe our estimates and assumptions are reasonable; however, actual results may differ materially from such estimates.



Presentation



In the opinion of management,
our unaudited combined financial statements as of June 30, 2013 and for the six month periods ended June 30, 2013 and 2012 include
all adjustments, which are of a normal and recurring nature, that are necessary for a fair presentation in accordance with GAAP.
These interim results are not necessarily indicative of the results to be expected for the year ending December 31, 2013.



Certain information and footnote
disclosures normally included in the combined financial statements prepared in accordance with GAAP have been condensed or omitted
in this Form TO pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). These combined
financial statements should be read in conjunction with the audited combined financial statements and notes thereto for the year
ended December 31, 2012.



F-7







ARABELLA
EXPLORATION, LIMITED LIABILITY COMPANY

NOTES TO UNAUDITED COMBINED FINANCIAL
STATEMENTS



| | 1. | NATURE OF BUSINESS, CRITICAL
                                         ACCOUNTING POLICIES AND PRESENTATION, continued
| | -- | ---------------------------------------------------------------------------------------------------------------------



Oil and Gas Properties



We follow the successful efforts
method of accounting for oil and gas properties, whereby costs of productive wells, developmental dry holes and productive leases
are capitalized into appropriate groups of properties based on geographical and geological similarities. These capitalized costs
are amortized using the unit-of-production method based on estimated proved reserves. Proceeds from sales of properties are credited
to property costs, and a gain or loss is recognized when a significant portion of an amortization base is sold or abandoned.



Exploration costs, including
geological and geophysical expenses and delay rentals, are charged to expense as incurred. Exploratory drilling costs, including
the cost of stratigraphic test wells, are initially capitalized but charged to exploration expense if and when the well is determined
to be nonproductive. The determination of an exploratory well’s ability to produce must be made within one year from the
completion of drilling activities. The acquisition costs of unproved acreage are initially capitalized and are carried at cost,
net of accumulated impairment provisions, until such leases are transferred to proved properties or charged to exploration expense
as impairments of unproved properties.



Revenue



We utilize the sales method
of accounting for oil, natural gas and natural gas liquids revenues whereby revenues, net of royalties, are recognized as the
production is sold to purchasers. The amount of gas sold may differ from the amount to which we are entitled based on our revenue
interests in the properties. We did not have any significant gas imbalance positions at June 30, 2013, or December 31, 2012.



Income Taxes



During 2013 and 2012, we were
not a taxable entity for federal income tax purposes. Accordingly, we do not directly pay federal income tax. Our taxable income
or loss, which may vary substantially from the net income or net loss we report in our combined statement of operations, is includable
in the federal income tax returns of the member.



We are subject to state income
based taxes and we use the asset and liability method to account for state income taxes. Under this method of accounting for income
taxes, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between
the combined financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred
tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those
temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in
enacted tax rates is recognized in the statements of operations in the period that includes the enactment date. We had no deferred
state income taxes for the six months ended June 30, 2013 or 2012.



Restatement



The accompanying financial
statements have been restated to include the related financial statements of Petroleum and to properly recognize and accrete our
asset retirement obligation. The restatement had the following impact on our financial statements:



F-8







ARABELLA
EXPLORATION, LIMITED LIABILITY COMPANY

NOTES TO UNAUDITED COMBINED FINANCIAL
STATEMENTS



| | 1. | NATURE OF BUSINESS, CRITICAL
                                         ACCOUNTING POLICIES AND PRESENTATION, continued
| | -- | ---------------------------------------------------------------------------------------------------------------------



Restatement, continued



|                                         |  | June 30, |         |   | December 31, |  
|---------------------------------------- |  | -------- | ------- | - | ------------ | -
|                                         |  | 2013     |         |   | 2012         |  
|Balance sheet:                           |  |          |         |   |              |  
|Increase in oil and gas properties       |  | $        | 837,354 |   |              | $
|Increase in asset retirement obligation  |  |          | 5,631   |   |              |  
|Increase in loans due sole shareholder   |  |          | 832,379 |   |              |  
|Increase (decrease) in retained earnings |  |          | (656    | ) |              |  



|                                                     |  | June 30, |      |   | June 30, |  
|---------------------------------------------------- |  | -------- | ---- | - | -------- | -
|                                                     |  | 2013     |      |   | 2012     |  
|Income statement:                                    |  |          |      |   |          |  
|Increase in depreciation, depletion and amortization |  | $        | (198 | ) |          | $



There was no net impact on
cash flows from operating, investing or financing activities.



| | 2. | GOING CONCERN CONSIDERATIONS
| | -- | ----------------------------



Since our inception, we have
been dependent on loans from our sole member to acquire working interests in various oil and gas properties and to support our
operations. We are developing plans for future operations and funding of our business plan and as part of that plan, we are currently
negotiating a reverse merger with a small public company to facilitate future fundraising and address current working capital
needs. Our dependence on our sole member raises substantial doubt about our ability to continue as a going concern.



These financial statements
do not include any adjustment that might result from the outcome of this uncertainty.



Our plans for the future will
require a significant amount of capital and there can be no assurances that we will be able to raise adequate short-term working
capital to sustain our current operations or that our oil and gas properties will ever provide adequate cash flows from operations
to sustain our business. The Company's long-term viability as a going concern is ultimately dependent upon the productivity of
our oil and gas properties.



F-9







ARABELLA
EXPLORATION, LIMITED LIABILITY COMPANY

NOTES TO UNAUDITED COMBINED FINANCIAL
STATEMENTS



| | 3. | OIL AND GAS PROPERTIES
| | -- | ----------------------



The following is an analysis
of capitalized costs for oil and gas properties as of June 30, 2013 and December 31, 2012:



|                           |  | June 30, |           |   | December 31, |  
|-------------------------- |  | -------- | --------- | - | ------------ | -
|                           |  | 2013     |           |   | 2012         |  
|                           |  |          |           |   |              |  
|Proved properties          |  | $        | 2,062,006 |   |              | $
|Unproved properties        |  |          | 6,178,989 |   |              |  
|                           |  |          |           |   |              |  
|Total capitalized costs    |  |          | 8,240,995 |   |              |  
|Less accumulated depletion |  |          | (61,434   | ) |              |  
|                           |  |          |           |   |              |  
|Total                      |  | $        | 8,179,561 |   |              | $



| | 4. | ASSET RETIREMENT OBLIGATION
| | -- | ---------------------------



Changes in our asset retirement
obligations (“ARO”) for the six months ended June 30, 2013 and 2012 are as follows:



|                                     |  | 2012 |       |  | 2011 |  
|------------------------------------ |  | ---- | ----- |  | ---- | -
|                                     |  |      |       |  |      |  
|Beginning of period                  |  | $    | 2,963 |  |      | $
|                                     |  |      |       |  |      |  
|Additions to ARO from new properties |  |      | 2,470 |  |      |  
|Accretion expense                    |  |      | 198   |  |      |  
|                                     |  |      |       |  |      |  
|End of period                        |  | $    | 5,631 |  |      | $



| | 5. | RELATED PARTY TRANSACTIONS
| | -- | --------------------------



Arabella Petroleum Company,
LLC ("Petroleum") is the operator of certain wells in which we hold working interests and also shares office facilities
and employees. Our sole member is also the sole member of Petroleum and certain costs of operations totaling $65,955 and $45,404
were allocated to us by Petroleum in the six months ended June 30, 2013 and 2012, respectively.



Petroleum, as operator of certain
oil and gas wells in which we held working interest during the six months ended June 30, 2013 and 2012, billed us oil and gas
property costs and lease operating expenses under joint interest billings. These costs totaled $298,515 and $0 for the six months
ended June 30, 2013 and 2012, respectively.



In the six months ended June
30, 2013 and 2012, Petroleum assigned oil and gas properties to us, and we recorded those properties at their historic cost to
Petroleum of $6,095,237 and $0, respectively.



F-10







ARABELLA
EXPLORATION, LIMITED LIABILITY COMPANY

NOTES TO UNAUDITED COMBINED FINANCIAL
STATEMENTS



| | 5. | RELATED PARTY TRANSACTIONS,
                                         continued
| | -- | ------------------------------------------------------------------------------



We have been dependent upon
informal loans from its sole member to fund our acquisition of oil and gas properties and meet our operating cash flow requirements.
The loans are unsecured and the member intends to formalize the note as a ten year non interest bearing note due in ten years.
In the six months ended June 30, 2013 and 2012, we have imputed interest on the note at 3.25% and included the amount as member
contributions of $2,662 and $0, respectively, in the statement of member’s equity. These loans are included in non current
liabilities because the member has committed to not require repayment in the next twelve months at June 30, 2013 and December
31, 2012.



| | 6. | SUBSEQUENT EVENTS
| | -- | -----------------



Subsequent to June 30, 2013,
oil and gas properties totaling $832,379 were transferred to us from Petroleum. The transfer of these oil and gas properties was
recognized and recorded on our Balance Sheet based upon Petroleum’s historic cost with an equal and offsetting increase
in Loans due to our sole member. Our financial statements are presented on a combined basis to include our financial position,
results of operations, changes in member’s equity and cash flows with the related financial statements associated with assets
and debt to our sole member, transferred to us from Arabella Petroleum, LLC, subsequent to June 30, 2013, as if the transfers
took place at the later of January 1, 2012 or the date the properties were acquired by Arabella Petroleum, LLC. in accordance
with Accounting Standards Codification (“ASC”) 805-50-45 issued by the Financial Accounting Standards Board (“FASB”).



| | 7. | SUPPLEMENTAL OIL AND GAS
                                         RESERVE INFORMATION (UNAUDITED)
| | -- | -------------------------------------------------------------------------------------------------



The estimates of proved oil
and gas reserves utilized in the preparation of the combined financial statements were prepared by independent petroleum engineers.
Such estimates are in accordance with guidelines established by the SEC and the FASB. All of our reserves are located in the United
States. For information about our results of operations from oil and gas activities, see the accompanying combined statements
of operations.



We emphasize that reserve estimates
are inherently imprecise. Accordingly, the estimates are expected to change as more current information becomes available. In
addition, a portion of our proved reserves are classified as proved undeveloped, which increases the imprecision inherent in estimating
reserves which may ultimately be produced.



At December 31, 2011, we had
no significant proved reserves and accordingly, our reserve information is as of December 31, 2012 and for the year then ended.
Properties assigned to us and subsequently sold were treated as unproved properties.



The following table sets forth
our estimated proved reserves together with the changes therein (Oil and NGL in Bbls, gas in Mcf, gas converted to BOE by dividing
Mcf by six) for the year ended December 31, 2012 and for the six months ended June 30, 2013, giving effect to reserves associated
with properties owned by Petroleum during the period and subsequently transferred to us:



F-11







ARABELLA
EXPLORATION, LIMITED LIABILITY COMPANY

NOTES TO UNAUDITED COMBINED FINANCIAL
STATEMENTS



| | 7. | SUPPLEMENTAL OIL AND GAS
                                         RESERVE INFORMATION (UNAUDITED), continued
| | -- | ------------------------------------------------------------------------------------------------------------



|                                                          |  | Oil |         |   | Gas |  |         | BOE | 
|--------------------------------------------------------- |  | --- | ------- | - | --- |  | ------- | --- | 
|                                                          |  |     |         |   |     |  |         |     | 
|Balance at December 31, 2011, as restated                 |  |     | 13,720  |   |     |  | -       |     | 
|                                                          |  |     |         |   |     |  |         |     | 
|Purchase and assignment of minerals in place, as restated |  |     | 153,280 |   |     |  | 378,511 |     | 
|Production                                                |  |     | (679    | ) |     |  | (1,338  | )   | 
|                                                          |  |     |         |   |     |  |         |     | 
|Balance at December 31, 2012, as restated                 |  |     | 166,321 |   |     |  | 377,173 |     | 
|                                                          |  |     |         |   |     |  |         |     | 
|Purchase and assignment of minerals in place, as restated |  |     | 316,663 |   |     |  | 446,402 |     | 
|Change in pricing                                         |  |     | (33     | ) |     |  | -       |     | 
|Production                                                |  |     | (1,194  | ) |     |  | (2,411  | )   | 
|                                                          |  |     |         |   |     |  |         |     | 
|Balance at June 30, 2013                                  |  |     | 481,757 |   |     |  | 821,164 |     | 



The standardized measure of
discounted future net cash flows relating to estimated proved reserves as of June 30, 2013 and December 31, 2012, giving effect
to reserves associated with properties owned by Petroleum during the period and transferred to us in 2013, was as follows (In
thousands):



|                                                  |  | June 30,   |         |   | December   |  
|------------------------------------------------- |  | ---------- | ------- | - | ---------- | -
|                                                  |  | 2013       |         |   | 31, 2012   |  
|                                                  |  | (Restated) |         |   | (Restated) |  
|                                                  |  |            |         |   |            |  
|Future cash inflows                               |  | $          | 45,393  |   |            | $
|Future costs:                                     |  |            |         |   |            |  
|Production                                        |  |            | (10,189 | ) |            |  
|Development                                       |  |            | (11,686 | ) |            |  
|                                                  |  |            |         |   |            |  
|Future net cash inflows                           |  |            | 23,518  |   |            |  
|10% discount factor                               |  |            | (14,208 | ) |            |  
|                                                  |  |            |         |   |            |  
|Standardized measure of discounted net cash flows |  | $          | 9,310   |   |            | $



Changes in the standardized
measure of discounted future net cash flows relating to estimated proved reserves for the six months ended June 30, 2013 and for
the year ended December 31, 2012, giving effect to reserves associated with properties owned by Petroleum during the period and
transferred to us in 2013, were as follows (In thousands):



F-12







ARABELLA
EXPLORATION, LIMITED LIABILITY COMPANY

NOTES TO UNAUDITED COMBINED FINANCIAL
STATEMENTS



| | 7. | SUPPLEMENTAL OIL AND GAS
                                         RESERVE INFORMATION (UNAUDITED), continued
| | -- | ------------------------------------------------------------------------------------------------------------



|                                               |  | June 30,   |       |   | December   |  
|---------------------------------------------- |  | ---------- | ----- | - | ---------- | -
|                                               |  | 2013       |       |   | 31, 2012   |  
|                                               |  | (Restated) |       |   | (Restated) |  
|                                               |  |            |       |   |            |  
|Standardized measure at beginning of period    |  | $          | 2,661 |   |            | $
|                                               |  |            |       |   |            |  
|Sales, net of production costs                 |  |            | (97   | ) |            |  
|Purchases and assignments of minerals in place |  |            | 6,746 |   |            |  
|                                               |  |            |       |   |            |  
|Standardized measure at end of period          |  | $          | 9,310 |   |            | $



The estimated present value
of future cash flows relating to estimated proved reserves is extremely sensitive to prices used at any measurement period. The
average prices used for each commodity for the six months ended June 30, 2013 and for the year ended December 31, 2012 were as
follows:



|                  |  | Average Price |      
|----------------- |  | ------------- | -----
|                  |  | Oil           |      
|                  |  |               |      
|December 31, 2012 |  | $             | 89.14
|June 30, 2013     |  |               | 88.08



Average
prices for June 30, 2013 and December 31, 2012 were based on the 12-month un-weighted arithmetic average of the first-day-of-the-month
price for the previous twelve month periods to June 30, 2013 and December 31, 2012.



Analysis of Reserves



The following table presents
Arabella’s estimated net proved oil and natural gas reserves and the present value of Arabella’s reserves as of December
31, 2012 and June 30, 2013, based on the reserve report prepared by WPC, and such reserve reports have been prepared in accordance
with the rules and regulations of the SEC. All Arabella’s proved reserves included in the reserve reports are located in
North America.



F-13







ARABELLA
EXPLORATION, LIMITED LIABILITY COMPANY

NOTES TO UNAUDITED COMBINED FINANCIAL
STATEMENTS



| | 8. | SUPPLEMENTAL OIL AND GAS
                                         RESERVE INFORMATION (UNAUDITED), continued
| | -- | ------------------------------------------------------------------------------------------------------------



Analysis of Reserves, continued



|                                        |  | Historical(1) |         |   | Restated (2) | 
|--------------------------------------- |  | ------------- | ------- | - | ------------ | 
|                                        |  | June 30,      |         |   | December 31, | 
|                                        |  | 2013          |         |   | 2012         | 
|                                        |  |               |         |   |              | 
|Estimated proved developed reserves:    |  |               |         |   |              | 
|Oil (MBbls)                             |  |               | 113.1   |   |              | 
|Natural gas (MMcf)                      |  |               | 147.4   |   |              | 
|Natural gas liquids (MBbls)             |  |               | -       |   |              | 
|Total (MBOE)                            |  |               | 137.6   |   |              | 
|Estimated proved undeveloped reserves:  |  |               |         |   |              | 
|Oil (MBbls)                             |  |               | 368.6   |   |              | 
|Natural gas (MMcf)                      |  |               | 673.8   |   |              | 
|Natural gas liquids (MBbls)             |  |               | -       |   |              | 
|Total (MBOE)                            |  |               | 480.9   |   |              | 
|Estimated Net Proved Reserves:          |  |               |         |   |              | 
|Oil (MBbls)                             |  |               | 481.8   |   |              | 
|Natural gas (MMcf)                      |  |               | 821.2   |   |              | 
|Natural gas liquids (MBbls)             |  |               | -       |   |              | 
|Total (MBOE)                            |  |               | 618.6   |   |              | 
|Percent proved developed                |  |               | 22.2    | % |              | 
|                                        |  |               |         |   |              | 
|Estimated probable developed reserves   |  |               |         |   |              | 
|Oil (MBbls)                             |  |               | -       |   |              | 
|Natural gas (MMCF)                      |  |               | -       |   |              | 
|Natural gas liquids (MBbls)             |  |               | -       |   |              | 
|Total (MBOE)                            |  |               | -       |   |              | 
|Estimated probable undeveloped reserves |  |               |         |   |              | 
|Oil (MBbls)                             |  |               | 2,139.6 |   |              | 
|Natural gas (MMCF)                      |  |               | 2,995.5 |   |              | 
|Natural gas liquids (MBbls)             |  |               | -       |   |              | 
|Total (MBOE)                            |  |               | 2,638.9 |   |              | 
|                                        |  |               |         |   |              | 
|Estimated possible developed reserves   |  |               |         |   |              | 
|Oil (MBbls)                             |  |               | -       |   |              | 
|Natural gas (MMCF)                      |  |               | -       |   |              | 
|Natural gas liquids (MBbls)             |  |               | -       |   |              | 
|Total (MBOE)                            |  |               | -       |   |              | 
|Estimated possible undeveloped reserves |  |               |         |   |              | 
|Oil (MBls)                              |  |               | 4,636.4 |   |              | 
|Natural gas (MMCF)                      |  |               | 6,575.2 |   |              | 
|Natural gas liquids (MBbls)             |  |               | -       |   |              | 
|Total (MBOE)                            |  |               | 5,732.3 |   |              | 



F-14







ARABELLA
EXPLORATION, LIMITED LIABILITY COMPANY

NOTES TO UNAUDITED COMBINED FINANCIAL
STATEMENTS



| | 8. | SUPPLEMENTAL OIL AND GAS
                                         RESERVE INFORMATION (UNAUDITED), continued
| | -- | ------------------------------------------------------------------------------------------------------------



Analysis of Reserves, continued



| | (1) | Estimates of reserves as of December
                                         31, 2012 and 2011 and through August 31, 2013 were prepared using an average price equal
                                         to the unweighted arithmetic average of hydrocarbon prices received on a field-by-field
                                         basis on the first day of each month within the 12-month periods ended December 31, 2012
                                         and 2011 and through August 31, 2013, respectively, in accordance with revised SEC guidelines
                                         applicable to reserves estimates as of the end of such periods. Reserve estimates do
                                         not include any value for probable or possible reserves that may exist, nor do they include
                                         any value for undeveloped acreage. The reserve estimates represent Arabella’s net
                                         revenue interest in Arabella’s properties. Although Arabella believes these estimates
                                         are reasonable, actual future production, cash flows, taxes, development expenditures,
                                         operating expenses and quantities of recoverable oil and natural gas reserves may vary
                                         substantially from these estimates.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | The reserves at December 31,
                                         2012 and 2011 have been restated, giving effect to reserves associated with properties
                                         owned by Petroleum during the period and transferred to us in 2012 and 2013.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The foregoing reserves are
all located within the continental United States. Reserve engineering is a subjective process of estimating volumes of economically
recoverable oil and natural gas that cannot be measured in an exact manner. The accuracy of any reserve estimate is a function
of the quality of available data and of engineering and geological interpretation. As a result, the estimates of different engineers
often vary. In addition, the results of drilling, testing and production may justify revisions of such estimates. Accordingly,
reserve estimates often differ from the quantities of oil and natural gas that are ultimately recovered. Estimates of economically
recoverable oil and natural gas and of future net revenues are based on a number of variables and assumptions, all of which may
vary from actual results, including geologic interpretation, prices and future production rates and costs. Arabella has not filed
any estimates of total, proved net oil or natural gas reserves with any federal authority or agency other than the SEC.



F-15











|ARABELLA
    EXPLORATION, LIMITED LIABILITY COMPANY             
|----------------------------------------------------------------
|COMBINED FINANCIAL
    STATEMENTS                               
|WITH REPORT OF INDEPENDENT
    REGISTERED PUBLIC ACCOUNTING FIRM
|December 31, 2012 and 2011                                      



F-16







|ARABELLA
    EXPLORATION, LIMITED LIABILITY COMPANY
|---------------------------------------------------
|TABLE OF CONTENTS                                  



|                                                        |  | Page       
|------------------------------------------------------- |  | -----------
|                                                        |  |            
|Report of Independent Registered Public Accounting Firm |  | F-18       
|                                                        |  |            
|Combined Financial Statements:                          |  |            
|                                                        |  |            
|Combined Balance Sheets                                 |  | F-19       
|                                                        |  |            
|Combined Statements of Operations                       |  | F-20       
|                                                        |  |            
|Combined Statement of Changes in Members'
    Equity    |  | F-21       
|                                                        |  |            
|Combined Statements of Cash Flows                       |  | F-22       
|                                                        |  |            
|Notes to Combined Financial Statements                  |  | F-23 – F-35



F-17













REPORT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM



To the Member of Arabella Exploration,
Limited Liability Company:



We have audited the accompanying combined
balance sheets of Arabella Exploration, Limited Liability Company (the Company) as of December 31, 2012 and 2011, and the related
combined statements of operations and member’s equity, and cash flows for the years then ended. These combined financial
statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these combined
financial statements based on our audits.



We conducted our audits in accordance
with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our opinion.



In our opinion, the combined financial
statements referred to above present fairly, in all material respects, the financial position of Arabella Exploration, Limited
Liability Company as of December 31, 2012 and 2011, and the results of its operations and their cash flows for the years then
ended, in conformity with U.S. generally accepted accounting principles.



The accompanying combined financial statements
have been prepared assuming that the Company will continue as a going concern. As shown in the combined financial statements and
discussed in Note 2, the Company has incurred recurring losses from operations and is dependent on outside sources of financing
for continuation of its operations. These and other factors raise substantial doubt about the Company's ability to continue as
a going concern. Management's plans with regard to this matter are also discussed in Note 2. These combined financial statements
do not include any adjustments that might result from the outcome of this uncertainty.



As further discussed in Note 1, the accompanying
combined financial statements have been restated to properly account for the Company’s asset retirement obligation and to
present transfers of assets received in 2013 from Arabella Petroleum, LLC, a company under common control, as if the transfers
took place at the later of January 1, 2011 or the date the properties were acquired by Arabella Petroleum, LLC.



| | /s/ Ham, Langston &
    Brezina, LLP
| | ------------------------------------



Houston, Texas

October 18, 2013, except for notes 1, 2, 4, 6, 7 and 8 as
to which

the date is December 12, 2013



F-18







|ARABELLA
    EXPLORATION, LIMITED LIABILITY COMPANY
|---------------------------------------------------
|COMBINED BALANCE SHEETS                            
|DECEMBER 31, 2012 AND 2011                         



|                                                          |  | 2012       |           |   | 2011       |  
|--------------------------------------------------------- |  | ---------- | --------- | - | ---------- | -
|                                                          |  | (Restated) |           |   | (Restated) |  
|ASSETS                                                    |  |            |           |   |            |  
|                                                          |  |            |           |   |            |  
|Current assets:                                           |  |            |           |   |            |  
|Cash and cash equivalents                                 |  | $          | 12,990    |   |            | $
|Accounts receivable - oil and gas sales                   |  |            | 7,588     |   |            |  
|                                                          |  |            |           |   |            |  
|Total current assets                                      |  |            | 20,578    |   |            |  
|                                                          |  |            |           |   |            |  
|Prepaid drilling costs to Arabella Petroleum Company, LLC |  |            | 219,495   |   |            |  
|Oil and gas properties, successful efforts method         |  |            | 1,516,236 |   |            |  
|                                                          |  |            |           |   |            |  
|Total assets                                              |  | $          | 1,756,309 |   |            | $
|                                                          |  |            |           |   |            |  
|LIABILITIES AND MEMBERS' EQUITY                           |  |            |           |   |            |  
|                                                          |  |            |           |   |            |  
|Current liabilities:                                      |  |            |           |   |            |  
|Accounts payable and accrued liabilities                  |  | $          | 20,000    |   |            | $
|Accrued joint interest billings payable                   |  |            | 42,238    |   |            |  
|                                                          |  |            |           |   |            |  
|Total current liabilities                                 |  |            | 62,238    |   |            |  
|                                                          |  |            |           |   |            |  
|Loans due to sole member                                  |  |            | 1,242,696 |   |            |  
|Asset retirement obligation                               |  |            | 2,963     |   |            |  
|                                                          |  |            |           |   |            |  
|Total liabilities                                         |  |            | 1,307,897 |   |            |  
|                                                          |  |            |           |   |            |  
|Commitments and contingencies                             |  |            |           |   |            |  
|                                                          |  |            |           |   |            |  
|Member’s equity:                                          |  |            |           |   |            |  
|Member contributions                                      |  |            | 129,061   |   |            |  
|Members distributions                                     |  |            | (500      | ) |            |  
|Retained earnings (accumulated deficit)                   |  |            | 319,851   |   |            |  
|                                                          |  |            |           |   |            |  
|Total member’s equity                                     |  |            | 448,412   |   |            |  
|                                                          |  |            |           |   |            |  
|Total liabilities and member’s equity                     |  | $          | 1,756,309 |   |            | $



The accompanying notes are an integral
part of the combined financial statements.



F-19







|ARABELLA
    EXPLORATION, LIMITED LIABILITY COMPANY
|---------------------------------------------------
|COMBINED STATEMENTS OF OPERATIONS                  
|FOR THE YEARS ENDED DECEMBER 31,
    2012 AND 2011 



|                                                                                       |  | 2012       |         |  | 2011       |  
|-------------------------------------------------------------------------------------- |  | ---------- | ------- |  | ---------- | -
|                                                                                       |  | (Restated) |         |  | (Restated) |  
|Revenues:                                                                              |  |            |         |  |            |  
|Oil and gas revenue                                                                    |  | $          | 65,881  |  |            | $
|Other operating revenue – gain on sale of oil and
    gas properties                   |  |            | 402,901 |  |            |  
|                                                                                       |  |            |         |  |            |  
|Total revenues                                                                         |  |            | 468,782 |  |            |  
|                                                                                       |  |            |         |  |            |  
|Costs and expenses:                                                                    |  |            |         |  |            |  
|Lease operating expenses                                                               |  |            | 12,526  |  |            |  
|Ad valorem and production taxes                                                        |  |            | 3,174   |  |            |  
|Depreciation, depletion and amortization                                               |  |            | 27,696  |  |            |  
|Accretion of asset retirement obligation                                               |  |            | 215     |  |            |  
|General and administrative expenses                                                    |  |            | 10,010  |  |            |  
|General and administrative expenses
    allocated from Arabella Petroleum Company, LLC |  |            | 93,845  |  |            |  
|                                                                                       |  |            |         |  |            |  
|Total costs and expenses                                                               |  |            | 147,466 |  |            |  
|                                                                                       |  |            |         |  |            |  
|Net income (loss)                                                                      |  | $          | 321,316 |  |            | $



The accompanying notes are an integral
part of the combined financial statements.



F-20







ARABELLA
EXPLORATION, LIMITED LIABILITY COMPANY

COMBINED STATEMENTS OF MEMBER’S
EQUITY

FOR THE YEARS ENDED DECEMBER 31, 2012
AND 2011



|                                                                             |  | Member        |         |  | Member        |   |      | Retained |  |   |         |  
|---------------------------------------------------------------------------- |  | ------------- | ------- |  | ------------- | - | ---- | -------- |  | - | ------- | -
|                                                                             |  | Contributions |         |  | Distributions |   |      | Earnings |  |   | Total   |  
|                                                                             |  |               |         |  |               |   |      |          |  |   |         |  
|Balance
    atDecember 31, 2010                                              |  | $             | -       |  |               | $ | -    |          |  | $ | -       |  
|                                                                             |  |               |         |  |               |   |      |          |  |   |         |  
|Member contributions:                                                        |  |               |         |  |               |   |      |          |  |   |         |  
|Cash contributions                                                           |  |               | 60      |  |               |   | -    |          |  |   | -       |  
|Contribution recognized for
    allocated general and administrative expense |  |               | 30,071  |  |               |   | -    |          |  |   | -       |  
|Interest imputed on member
    loans                                         |  |               | 370     |  |               |   | -    |          |  |   | -       |  
|                                                                             |  |               |         |  |               |   |      |          |  |   |         |  
|Member distributions                                                         |  |               | -       |  |               |   | (500 | )        |  |   | -       |  
|                                                                             |  |               |         |  |               |   |      |          |  |   |         |  
|Net loss,
    as restated                                                    |  |               | -       |  |               |   | -    |          |  |   | (1,465  | )
|                                                                             |  |               |         |  |               |   |      |          |  |   |         |  
|Balance
    at December 31,2011, as restated                                 |  |               | 30,501  |  |               |   | (500 | )        |  |   | (1,465  | )
|                                                                             |  |               |         |  |               |   |      |          |  |   |         |  
|Member contributions:                                                        |  |               |         |  |               |   |      |          |  |   |         |  
|Contribution recognized for
    allocated general and administrative expense |  |               | 93,845  |  |               |   | -    |          |  |   | -       |  
|Interest imputed on member
    loans                                         |  |               | 4,715   |  |               |   | -    |          |  |   | -       |  
|                                                                             |  |               |         |  |               |   |      |          |  |   |         |  
|Net income,
    as restated                                                  |  |               | -       |  |               |   | -    |          |  |   | 321,316 |  
|                                                                             |  |               |         |  |               |   |      |          |  |   |         |  
|Balance at December
    31, 2012, as restated                                |  | $             | 129,061 |  |               | $ | (500 | )        |  | $ | 319,851 |  



The accompanying notes are an integral
part of the combined financial statements.



F-21







|ARABELLA
    EXPLORATION, LIMITED LIABILITY COMPANY
|---------------------------------------------------
|COMBINED STATEMENTS OF CASH FLOWS                  
|FOR THE YEARS ENDED DECEMBER 31,
    2012 AND 2011 



|                                                                                            |  | 2012       |           |   | 2011       |  
|------------------------------------------------------------------------------------------- |  | ---------- | --------- | - | ---------- | -
|                                                                                            |  | (Restated) |           |   | (Restated) |  
|Cash flows from operating activities:                                                       |  |            |           |   |            |  
|Net income (loss)                                                                           |  | $          | 321,316   |   |            | $
|Adjustments to reconcile net income (loss) to net
    cash used in operating activities:    |  |            |           |   |            |  
|Depreciation, depletion and amortization                                                    |  |            | 27,696    |   |            |  
|Accretion of asset retirement obligation                                                    |  |            | 215       |   |            |  
|Contribution recognized for allocated general and
    administrative expenses               |  |            | 93,845    |   |            |  
|Gain from sale of oil and gas properties                                                    |  |            | (402,901  | ) |            |  
|Changes in operating assets and liabilities:                                                |  |            |           |   |            |  
|Accounts receivable - oil and gas sales                                                     |  |            | (2,621    | ) |            |  
|Accounts payable and accrued
    liabilities                                                |  |            | 50,986    |   |            |  
|                                                                                            |  |            |           |   |            |  
|Net cash provided by operating
    activities                                               |  |            | 88,536    |   |            |  
|                                                                                            |  |            |           |   |            |  
|Cash flows from investing activities:                                                       |  |            |           |   |            |  
|Additions to oil and gas properties                                                         |  |            | (526,642  | ) |            |  
|Proceeds from sale of oil and gas properties                                                |  |            | 592,702   |   |            |  
|Prepaid drilling costs                                                                      |  |            | (155,177  | ) |            |  
|                                                                                            |  |            |           |   |            |  
|Net cash used in investing activities                                                       |  |            | (89,117   | ) |            |  
|                                                                                            |  |            |           |   |            |  
|Cash flows from financing activities:                                                       |  |            |           |   |            |  
|Proceeds from member contributions                                                          |  |            | -         |   |            |  
|Member distributions                                                                        |  |            | -         |   |            |  
|Proceeds from member loans                                                                  |  |            | 74,942    |   |            |  
|Repayment of member loans                                                                   |  |            | (61,386   | ) |            |  
|                                                                                            |  |            |           |   |            |  
|Net cash provided by financing
    activities                                               |  |            | 13,556    |   |            |  
|                                                                                            |  |            |           |   |            |  
|Net (decrease) increase in cash and cash equivalents                                        |  |            | 12,975    |   |            |  
|                                                                                            |  |            |           |   |            |  
|Cash and cash equivalents at beginning
    of year                                          |  |            | 15        |   |            |  
|                                                                                            |  |            |           |   |            |  
|Cash and cash equivalents at
    end of year                                                |  | $          | 12,990    |   |            | $
|                                                                                            |  |            |           |   |            |  
|Non-cash investing and financing activities:                                                |  |            |           |   |            |  
|Addition to oil and gas properties
    through increase in member loan                      |  | $          | 1,074,431 |   |            | $
|Capitalized imputed interest
    expense contributed by sole member related to member loans |  | $          | 4,715     |   |            | $
|Increase in oil and gas properties through recognition
    of asset retirement obligation   |  | $          | 2,638     |   |            |  



The accompanying notes are an integral
part of the combined financial statements.



F-22







|ARABELLA
    EXPLORATION, LIMITED LIABILITY COMPANY
|---------------------------------------------------
|NOTES TO COMBINED FINANCIAL STATEMENTS             



| | 1. | NATURE OF BUSINESS AND SIGNIFICANT
                                         ACCOUNTING POLICIES
| | -- | -----------------------------------------------------------------------------------------------



General



Arabella Exploration, Limited
Liability Company (the "Company") was formed in 2009, to acquire interests in low risk prospective or currently producing
oil and gas properties primarily in the Texas Permian Basin. The Company's business is affected by economic conditions in the
United States and by the cyclical nature of the petroleum industry. We did not engage in any significant activity until the third
quarter of 2011.



Substantially all of our oil
and gas production is sold under short-term contracts which are market-sensitive. Accordingly, our results of operations and capital
resources are highly dependent upon prevailing market prices of, and demand for, oil and natural gas. These commodity prices are
subject to wide fluctuations and market uncertainties due to a variety of factors that are beyond our control. These factors include
the level of global supply and demand for oil and natural gas, market uncertainties, weather conditions, domestic governmental
regulations and taxes, political and economic conditions in oil producing countries, price and availability of alternative fuels,
and overall domestic and foreign economic conditions.



Combined Financial Statements



Our financial statements are
presented on a combined basis to include the related financial statements of Arabella Petroleum, LLC (“Petroleum”)
because the Company and Petroleum are under common control. The related financial statements of Petroleum include oil and gas
properties totaling $1,090,429 which were owned by Petroleum prior to 2013 and transferred to the Company in 2013. The transfers
were a non-cash transaction in which the loan due to the sole member increased by $1,090,429. The transfers are accounted for
as if they took place at the later of January 1, 2011, or the date the properties were acquired by Petroleum in accordance with
Accounting Standards Codification (“ASC”) 805-50-45 issued by the Financial Accounting Standards Board (“FASB”).



Use of Estimates



The process of preparing combined
financial statements in conformity with accounting principles generally accepted in the United States of America ("GAAP")
requires management to make estimates and assumptions that affect reported amounts of certain assets, liabilities, revenues and
expenses. We believe our estimates and assumptions are reasonable; however, actual results may differ materially from such estimates.
The most significant estimates and assumptions we made are used in determining:



| | • | Provisions for depreciation,
                                         depletion and amortization and estimates of non-equity plans are based on estimates of
                                         proved reserves;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | • | Impairments of long-lived assets
                                         are based on estimates of future net cash flows and, when applicable, the estimated fair
                                         values of impaired assets;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | • | Asset retirement obligations
                                         are based on estimates regarding the timing and cost of future asset retirements.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------



Cash and Cash
Equivalents



We consider highly liquid debt
instruments with an original maturity of three months or less, when purchased, to be cash equivalents.



F-23







|ARABELLA
    EXPLORATION, LIMITED LIABILITY COMPANY
|---------------------------------------------------
|NOTES TO COMBINED FINANCIAL STATEMENTS             



| | 1. | NATURE OF BUSINESS AND SIGNIFICANT
                                         ACCOUNTING POLICIES, continued
| | -- | ----------------------------------------------------------------------------------------------------------



Concentrations
of Credit Risk



The Company places temporary
cash investments with financial institutions and invests in those institutions and instruments that management believes have minimal
credit risk and market risk. At December 31, 2012 and 2011, the Company holds only demand deposits. Balances may periodically
exceed federal deposit insurance limitations.



Trade accounts receivables
consist primarily of amounts due to us for sales of oil and gas. We assess the collectability of all receivables on an ongoing
basis by considering its historical credit loss experience, current economic conditions, and other relevant factors. Based on
this analysis, we determined that no allowance of was necessary at December 31, 2012 or 2011. Our most significant concentrations
of credit risk lies with oil and gas companies operating in the United States. All of our proved reserves are located in the United
States.



Oil and Gas Properties



We follow the successful efforts
method of accounting for oil and gas properties, whereby costs of productive wells, developmental dry holes and productive leases
are capitalized into appropriate groups of properties based on geographical and geological similarities. These capitalized costs
are amortized using the unit-of-production method based on estimated proved reserves. Proceeds from sales of properties are credited
to property costs, and a gain or loss is recognized when a significant portion of an amortization base is sold or abandoned.



Exploration costs, including
geological and geophysical expenses and delay rentals, are charged to expense as incurred. Exploratory drilling costs, including
the cost of stratigraphic test wells, are initially capitalized but charged to exploration expense if and when the well is determined
to be nonproductive. The determination of an exploratory well’s ability to produce must be made within one year from the
completion of drilling activities. The acquisition costs of unproved acreage are initially capitalized and are carried at cost,
net of accumulated impairment provisions, until such leases are transferred to proved properties or charged to exploration expense
as impairments of unproved properties.



Capitalized Interest



Interest costs associated with
our inventory of unproved oil and gas property lease acquisition costs, if any, are capitalized during the periods for which exploration
activities are in progress. During the years ended December 31, 2012 and 2011, we capitalized interest costs of $4,715 and $370,
respectively.



Valuation of Property and
Equipment



Our long-lived assets, including
proved oil and gas properties, are assessed for potential impairment in their carrying values, based on depletable groupings,
whenever events or changes in circumstances indicate such impairment may have occurred. Impairment is recognized when the estimated
undiscounted future net cash flows of the asset are less than its carrying value. Any such impairment is recognized based on the
difference in the carrying value and estimated fair value of the impaired asset.



F-24







|ARABELLA
    EXPLORATION, LIMITED LIABILITY COMPANY
|---------------------------------------------------
|NOTES TO COMBINED FINANCIAL STATEMENTS             



| | 1. | NATURE OF BUSINESS AND SIGNIFICANT
                                         ACCOUNTING POLICIES, continued
| | -- | ----------------------------------------------------------------------------------------------------------



Valuation of Property and
Equipment, continued



Unproved oil and gas properties
are periodically assessed, and any impairment in value is charged to exploration costs. The amount of impairment recognized on
unproved properties which are not individually significant is determined by impairing the costs of such properties within appropriate
groups based on our historical experience, acquisition dates and average lease terms. The valuation of unproved properties is
subjective and requires management to make estimates and assumptions which, with the passage of time, may prove to be materially
different from actual realizable values.



Asset Retirement Obligation



We recognize a liability for
the present value of all legal obligations associated with the retirement of tangible, long-lived assets and capitalize an equal
amount as a cost of the asset. The cost associated with the asset retirement obligation, along with any estimated salvage value,
is included in the computation of depreciation, depletion and amortization.



Revenue



We utilize the sales method
of accounting for oil, natural gas and natural gas liquids revenues whereby revenues, net of royalties, are recognized as the
production is sold to purchasers. The amount of gas sold may differ from the amount to which we are entitled based on our revenue
interests in the properties. We did not have any significant gas imbalance positions at December 31, 2012 or 2011.



Income Taxes



During 2012 and 2011, we were
not a taxable entity for federal income tax purposes. Accordingly, we do not directly pay federal income tax. Our taxable income
or loss, which may vary substantially from the net income or net loss we report in our combined statement of income, is includable
in the federal income tax returns of the member. The aggregate difference in the basis of our net assets for financial compared
to tax reporting purposes is not determined at December 31, 2012 or 2011 because it is dependent on the tax circumstances of the
member.



We are subject to state income
based taxes and we use the asset and liability method to account for state income taxes. Under this method of accounting for income
taxes, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between
the combined financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred
tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those
temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in
enacted tax rates is recognized in the statements of operations in the period that includes the enactment date. We had no state
income tax provision in the years ended December 31, 2012 and 2011.



Fair Value of Financial
Instruments



Fair value estimates of financial
instruments as per Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”)
820 "Fair Value Measurements and Disclosure", are based on relevant market information and may be subjective in nature
and involve uncertainties and matters of significant judgment. We believe that the carrying value of our assets and liabilities
approximates the fair value of such items. We do not hold or issue financial instruments for trading purposes.



F-25







|ARABELLA
    EXPLORATION, LIMITED LIABILITY COMPANY
|---------------------------------------------------
|NOTES TO COMBINED FINANCIAL STATEMENTS             



| | 1. | NATURE OF BUSINESS AND SIGNIFICANT
                                         ACCOUNTING POLICIES, continued
| | -- | ----------------------------------------------------------------------------------------------------------



Fair Value of Financial
Instruments, continued



We include fair value information
in the notes to combined financial statements when the fair value of financial instruments is different from the book value. When
the book value approximates fair value, no additional disclosure is made.



Restatement



The accompanying combined financial
statements have been restated to properly recognize and accrete our asset retirement obligation and to present transfers of assets
received in 2013 from Arabella Petroleum, LLC, a company under common control, as if the transfers took place at the later of
January 1, 2011, or the date the properties were acquired by Arabella Petroleum, LLC. The restatement had the following impact
on our combined financial statements:



|                                         |  | 2012 |           |   | 2011 |  
|---------------------------------------- |  | ---- | --------- | - | ---- | -
|Balance Sheet:                           |  |      |           |   |      |  
|Increase in oil and gas properties       |  | $    | 1,093,151 |   |      | $
|Increase in asset retirement obligation  |  |      | 2,963     |   |      |  
|Increase in loans due to sole member     |  |      | 1,090,429 |   |      |  
|Increase (decrease) in retained earnings |  |      | (241      | ) |      |  



|Statement of Operations:                             |  |   |      |   |  |   |      |  
|---------------------------------------------------- |  | - | ---- | - |  | - | ---- | -
|Increase in gain from sale of oil and gas properties |  | $ | 374  |   |  |   | -    |  
|Increase in depreciation, depletion and amortization |  |   | (122 | ) |  |   | (181 | )
|Increase in accretion of asset retirement obligation |  |   | (215 | ) |  |   | (97  | )
|                                                     |  |   |      |   |  |   |      |  
|                                                     |  | $ | 37   |   |  | $ | (278 | )



Recent Accounting Pronouncements



In December 2011 the FASB issued
ASU No. 2011-11, “Balance Sheet (Topic 210), Disclosures about Offsetting Assets and Liabilities” (“ASU 2011-11”).
ASU 2011-11 will require entities to disclose both gross information and net information about both instruments and transactions
eligible for offset in the statement of financial position and instruments and transactions subject to an agreement similar to
a master netting arrangement. Application of the ASU is required for annual reporting periods beginning on or after January 1,
2013 and interim periods within those annual periods. At that time we will make the necessary disclosures. The adoption of ASU
2011-11 will not impact our future financial position, results of operation or liquidity.



| | 2. | GOING CONCERN CONSIDERATIONS
| | -- | ----------------------------



Since our inception, we have
been dependent on loans from our sole member to acquire working interests in various oil and gas properties and to support our
operations. We are developing plans for future operations and funding of our business plan and as part of that plan, we are currently
negotiating a reverse merger with a small public company to facilitate future fundraising and address current working capital
needs. Our dependence on our sole member raises substantial doubt about our ability to continue as a going concern.



These combined financial statements
do not include any adjustment that might result from the outcome of this uncertainty.



F-26







|ARABELLA
    EXPLORATION, LIMITED LIABILITY COMPANY
|---------------------------------------------------
|NOTES TO COMBINED FINANCIAL STATEMENTS             



| | 2. | GOING CONCERN CONSIDERATIONS,
                                         continued
| | -- | --------------------------------------------------------------------------------



Our plans will require a significant
amount of capital and there can be no assurances that we will be able to raise adequate short-term working capital to sustain
our current operations or that our oil and gas properties will ever provide adequate cash flows from operations to sustain our
business. The Company's long-term viability as a going concern is ultimately dependent upon the productivity of our oil and gas
properties.



| | 3. | ACCOUNTS RECEIVABLE - OIL
                                         AND GAS SALES AND MAJOR CUSTOMERS
| | -- | ----------------------------------------------------------------------------------------------------



At December 31, 2012 and 2011,
we had accounts receivable from sale of oil and gas of $7,588 and 4,967, respectively. The balance includes amounts due from customers
that accounted for 10% or more of our oil and gas revenue in 2012 and 2011. Following is an analysis of accounts receivable from
our major customers at December 31, 2012 and 2011:



|           |  | Accounts Receivable |      
|---------- |  | ------------------- | -----
|           |  | 2012                |      
|           |  |                     |      
|Customer 1 |  | $                   | 1,702
|Customer 2 |  |                     | 2,139



Following is related sales
information for 2012 and 2011:



|           |  | Revenue |       
|---------- |  | ------- | ------
|           |  | 2012    |       
|           |  |         |       
|Customer 1 |  | $       | 41,778
|Customer 2 |  |         | 20,605



| | 4. | OIL AND GAS PROPERTIES
| | -- | ----------------------



The following is an analysis
of costs incurred with respect to oil and gas properties in 2012 and 2011:



|                       |  | 2012       |           |  | 2011       |  
|---------------------- |  | ---------- | --------- |  | ---------- | -
|                       |  | (Restated) |           |  | (Restated) |  
|Property acquisitions: |  |            |           |  |            |  
|Proved                 |  | $          | 105,294   |  |            | $
|Unproved               |  |            | 969,137   |  |            |  
|Developmental costs    |  |            | 531,357   |  |            |  
|Exploratory costs      |  |            | -         |  |            |  
|                       |  |            |           |  |            |  
|Total                  |  | $          | 1,605,788 |  |            | $



F-27







|ARABELLA
    EXPLORATION, LIMITED LIABILITY COMPANY
|---------------------------------------------------
|NOTES TO COMBINED FINANCIAL STATEMENTS             



| | 4. | OIL AND GAS PROPERTIES, continued
| | -- | ---------------------------------



The following is an analysis of capitalized costs
for oil and gas properties as of December 31, 2012 and 2011.



|                           |  | 2012       |           |   | 2011       |  
|-------------------------- |  | ---------- | --------- | - | ---------- | -
|                           |  | (Restated) |           |   | (Restated) |  
|                           |  |            |           |   |            |  
|Proved properties          |  | $          | 500,883   |   |            | $
|Unproved properties        |  |            | 1,031,211 |   |            |  
|                           |  |            |           |   |            |  
|Total capitalized costs    |  |            | 1,532,094 |   |            |  
|Less accumulated depletion |  |            | (15,858   | ) |            |  
|                           |  |            |           |   |            |  
|Total                      |  | $          | 1,516,236 |   |            | $



Depletion expense was $27,696
and $5,724 for 2012 and 2011, respectively. Sales of oil and gas properties reduced accumulated depletion by $17,562 in 2012.



| | 5. | RELATED PARTY TRANSACTIONS
| | -- | --------------------------



Arabella Petroleum Company,
LLC ("Petroleum") is the operator of certain wells in which we hold working interests and also shares office facilities
and employees. Our sole owner is also the sole owner of Petroleum and certain costs of operations are allocated to us by Petroleum
as follows:



|                                      |  | 2012 |        |  | 2011 |  
|------------------------------------- |  | ---- | ------ |  | ---- | -
|                                      |  |      |        |  |      |  
|Depreciation expense                  |  | $    | 3,853  |  |      | $
|General liability insurance           |  |      | 4,388  |  |      |  
|Legal and professional fees           |  |      | 3,412  |  |      |  
|Office and equipment rental           |  |      | 13,735 |  |      |  
|Office supplies                       |  |      | 3,543  |  |      |  
|Other general and administrative      |  |      | 22,107 |  |      |  
|Salaries, wages and employee benefits |  |      | 12,625 |  |      |  
|Software and computer related         |  |      | 10,159 |  |      |  
|Telephone and internet                |  |      | 2,750  |  |      |  
|Travel                                |  |      | 17,273 |  |      |  
|                                      |  |      |        |  |      |  
|                                      |  | $    | 93,845 |  |      | $



F-28







|ARABELLA
    EXPLORATION, LIMITED LIABILITY COMPANY
|---------------------------------------------------
|NOTES TO COMBINED FINANCIAL STATEMENTS             



| | 5. | RELATED PARTY TRANSACTIONS,
                                         continued
| | -- | ------------------------------------------------------------------------------



Petroleum, as operator of certain
oil and gas wells in which we held working interest during 2012 and 2011, billed us oil and gas property costs under joint interest
billing, as follows:



|                                         |  | 2012 |         |  | 2011 |  
|---------------------------------------- |  | ---- | ------- |  | ---- | -
|                                         |  |      |         |  |      |  
|Prepaid drilling costs                   |  | $    | 225,932 |  |      | $
|                                         |  |      |         |  |      |  
|Oil and gas properties:                  |  |      |         |  |      |  
|Intangible drilling and completion costs |  |      | 179,107 |  |      |  
|Lease and well equipment                 |  |      | 70,328  |  |      |  
|Lease acquisition costs                  |  |      | 46,079  |  |      |  



Oil and gas revenues from wells
operated by Petroleum was $702 and $-0- in 2012 and 2011, respectively. Additionally, the gain from sale of oil and gas properties
of $402,527 and $34,467 for 2012 and 2011, were on properties assigned to us by Petroleum.



Subsequent to December 31,
2012, Petroleum, a company under common control, transferred and assigned properties to us and these financial statements are
presented on a combined basis, as if the transfers took place at the later of January 1, 2011 or the date the properties were
acquired by Petroleum (See notes 1 and 7).



We have been dependent upon
informal loans from its sole member to fund our acquisition of oil and gas properties and meet our operating cash flow requirements.
The loans are unsecured and the member intends to formalize the note as a ten year non interest bearing note due in ten years.
In 2012 and 2011, we have imputed interest on the note at 3.25% and included the amount as member contributions of $370 and $4,715,
respectively, in the statement of member’s equity.	These loans are included in non current liabilities because the member
has committed to not require repayment in the next twelve months at December 31, 2012 and 2011.



| | 6. | ASSET RETIREMENT OBLIGATION
| | -- | ---------------------------



Changes in our asset retirement
obligations (“ARO”) for 2012 and 2011 are as follows:



|                                     |  | 2012 |        |   | 2011 |  
|------------------------------------ |  | ---- | ------ | - | ---- | -
|                                     |  |      |        |   |      |  
|Beginning of year                    |  | $    | 2,796  |   |      | $
|                                     |  |      |        |   |      |  
|Additions to ARO from new properties |  |      | 2,638  |   |      |  
|Sales or abandonments of properties  |  |      | (2,686 | ) |      |  
|Accretion expense                    |  |      | 215    |   |      |  
|                                     |  |      |        |   |      |  
|End of year                          |  | $    | 2,963  |   |      | $



F-29







|ARABELLA
    EXPLORATION, LIMITED LIABILITY COMPANY
|---------------------------------------------------
|NOTES TO COMBINED FINANCIAL STATEMENTS             



| | 7. | SUBSEQUENT EVENTS AND PROFORMA
                                         FINANCIAL INFORMATION
| | -- | ---------------------------------------------------------------------------------------------



At December 31, 2013 and 2012,
the oil and gas properties totaling $1,090,429 that were owned by Petroleum prior to 2013 and transferred to the Company in 2013
were recorded on the Balance Sheets, because the Company and Petroleum are under common control. In 2013 Petroleum transferred
additional oil and gas properties totaling $6,157,314 to the Company that were originally acquired by Petroleum during the first
six months of 2013. These additional property transfers were recorded in 2013 at Petroleum’s historical cost because they
were not owned under common control at December 31, 2012. These additional property transfers were recorded as non-cash transactions
in 2013 that increased the loans due to sole member by $6,157,314.



The accompanying proforma condensed
balance sheet is unaudited and illustrate the effect of property transfers from Petroleum as if the transfer described in the
previous paragraph occurred on December 31, 2012. The proforma combined balance sheet as of December 31, 2012, is based on the
historical balance sheets of the Company and the properties of Petroleum at that date and assumes the transfer of properties then
owned by Petroleum took place at that date. The proforma statements of operations for the year ended December 31, 2012, is not
presented because the property transfers had no impact on the historical statements of operations of the Company. The proforma
condensed statements of cash flows for the year ended December 31, 2012 is not presented because the property transfers had no
impact on cash flows from operations, cash flows from investing or cash flows from financing activities. The property transfers
were recorded as non-cash transactions in 2013 that increased the loans due to sole member by $6,157,314.



The proforma condensed combined
financial statements may not be indicative of the actual results of the transfers. The accompanying proforma condensed combined
financial statements should be read in connection with the historical financial statements of the Company, including the related
notes, and other financial information included in this filing.



F-30







|ARABELLA
    EXPLORATION, LIMITED LIABILITY COMPANY
|---------------------------------------------------
|NOTES TO COMBINED FINANCIAL STATEMENTS             



| | 7. | SUBSEQUENT EVENTS AND PROFORMA
                                         FINANCIAL INFORMATION, continued
| | -- | --------------------------------------------------------------------------------------------------------



Proforma Balance Sheet



|                                                      |  | Arabella |           |   | Proforma    |   |           | Proforma | 
|----------------------------------------------------- |  | -------- | --------- | - | ----------- | - | --------- | -------- | 
|                                                      |  | Combined |           |   | Adjustments |   |           | Balance  | 
|                                                      |  | Restated |           |   |             |   |           |          | 
|ASSETS                                                |  |          |           |   |             |   |           |          | 
|                                                      |  |          |           |   |             |   |           |          | 
|Current assets:                                       |  |          |           |   |             |   |           |          | 
|Cash and cash equivalents                             |  | $        | 12,990    |   |             | $ | -         |          | 
|Accounts receivable - oil and gas                     |  |          |           |   |             |   |           |          | 
|Sales                                                 |  |          | 7,588     |   |             |   | -         |          | 
|                                                      |  |          |           |   |             |   |           |          | 
|Total current assets                                  |  |          | 20,578    |   |             |   | -         |          | 
|                                                      |  |          |           |   |             |   |           |          | 
|Prepaid drilling costs to Arabella                    |  |          |           |   |             |   |           |          | 
|Petroleum Company, LLC                                |  |          | 219,495   |   |             |   | -         |          | 
|Oil and gas properties, successful
    efforts method |  |          | 1,516,236 |   |             |   | 6,157,314 |          | 
|                                                      |  |          |           |   |             |   |           |          | 
|Total assets                                          |  | $        | 1,756,309 |   |             | $ | 6,157,314 |          | 
|                                                      |  |          |           |   |             |   |           |          | 
|LIABILITIES AND MEMBERS' EQUITY                       |  |          |           |   |             |   |           |          | 
|                                                      |  |          |           |   |             |   |           |          | 
|Current liabilities:                                  |  |          |           |   |             |   |           |          | 
|Accounts payable and accrued                          |  |          |           |   |             |   |           |          | 
|Liabilities                                           |  | $        | 20,000    |   |             | $ | -         |          | 
|Accrued joint interest billings
    payable           |  |          | 42,238    |   |             |   | -         |          | 
|                                                      |  |          |           |   |             |   |           |          | 
|Total current liabilities                             |  |          | 62,238    |   |             |   |           |          | 
|                                                      |  |          |           |   |             |   |           |          | 
|Loans due to sole member                              |  |          | 1,242,696 |   |             |   | 6,157,314 |          | 
|Asset retirement obligation                           |  |          | 2,963     |   |             |   | -         |          | 
|                                                      |  |          |           |   |             |   |           |          | 
|Total liabilities                                     |  |          | 1,307,897 |   |             |   | 6,157,314 |          | 
|                                                      |  |          |           |   |             |   |           |          | 
|Commitments and contingencies                         |  |          |           |   |             |   |           |          | 
|                                                      |  |          |           |   |             |   |           |          | 
|Members' equity:                                      |  |          |           |   |             |   |           |          | 
|Member contributions                                  |  |          | 129,061   |   |             |   | -         |          | 
|Distributions to members                              |  |          | (500      | ) |             |   | -         |          | 
|Retained earnings                                     |  |          | 319,851   |   |             |   | -         |          | 
|                                                      |  |          |           |   |             |   |           |          | 
|Total members' equity                                 |  |          | 448,412   |   |             |   | -         |          | 
|                                                      |  |          |           |   |             |   |           |          | 
|Total liabilities and members'
    Equity             |  | $        | 1,756,309 |   |             | $ | 6,157,314 |          | 



F-31







|ARABELLA
    EXPLORATION, LIMITED LIABILITY COMPANY
|---------------------------------------------------
|NOTES TO COMBINED FINANCIAL STATEMENTS             



| | 8. | SUPPLEMENTAL OIL AND GAS
                                         RESERVE INFORMATION (UNAUDITED)
| | -- | -------------------------------------------------------------------------------------------------



The estimates of proved oil
and gas reserves utilized in the preparation of the combined financial statements were prepared by independent petroleum engineers.
Such estimates are in accordance with guidelines established by the SEC and the FASB. All of our reserves are located in the United
States. For information about our results of operations from oil and gas activities, see the accompanying combined statements
of operations.



We emphasize that reserve estimates
are inherently imprecise. Accordingly, the estimates are expected to change as more current information becomes available. In
addition, a portion of our proved reserves are classified as proved developed nonproducing and proved undeveloped, which increases
the imprecision inherent in estimating reserves which may ultimately be produced.



At December 31, 2011, we had
no significant proved reserves and accordingly, our reserve information is as of December 31, 2012 and for the year then ended.
Properties assigned to us and subsequently sold were treated as unproved properties. We had capital costs relating to exploratory
wells pending the determination of proved reserves $-0- and $63,398 for the year ended December 31, 2012 and 2011, respectively.
All capital costs related to exploratory wells at December 31, 2011 were transferred to proved properties in 2012.



The following table sets forth
estimated proved reserves together with the changes therein (Oil and NGL in Bbls, gas in Mcf, gas converted to BOE by dividing
Mcf by six) for the year ended December 31, 2012, giving effect to reserves associated with properties owned by Petroleum during
the period and transferred to us in 2013:



|                                                          |  | Oil |         |   | Gas |  |         | BOE | 
|--------------------------------------------------------- |  | --- | ------- | - | --- |  | ------- | --- | 
|                                                          |  |     |         |   |     |  |         |     | 
|Balance at December 31, 2010                              |  |     | -       |   |     |  | -       |     | 
|                                                          |  |     |         |   |     |  |         |     | 
|Purchase and assignment of minerals in place, as restated |  |     | 13,720  |   |     |  | -       |     | 
|                                                          |  |     |         |   |     |  |         |     | 
|Balance at December 31, 2011, as restated                 |  |     | 13,720  |   |     |  | -       |     | 
|                                                          |  |     |         |   |     |  |         |     | 
|Purchase and assignment of minerals in place, as restated |  |     | 153,280 |   |     |  | 378,511 |     | 
|Production                                                |  |     | (679    | ) |     |  | (1,338  | )   | 
|                                                          |  |     |         |   |     |  |         |     | 
|Balance at December 31, 2012, as restated                 |  |     | 166,321 |   |     |  | 377,173 |     | 



The standardized measure of
discounted future net cash flows relating to estimated proved reserves as of December 31, 2012 and 2011, giving effect to reserves
associated with properties owned by Petroleum during the period and transferred to us in 2013, was as follows (In thousands):



F-32







|ARABELLA
    EXPLORATION, LIMITED LIABILITY COMPANY
|---------------------------------------------------
|NOTES TO COMBINED FINANCIAL STATEMENTS             



| | 8. | SUPPLEMENTAL OIL AND GAS
                                         RESERVE INFORMATION (UNAUDITED), continued
| | -- | ------------------------------------------------------------------------------------------------------------



|                                                  |  | 2012       |        |   | 2011       |  
|------------------------------------------------- |  | ---------- | ------ | - | ---------- | -
|                                                  |  | (Restated) |        |   | (Restated) |  
|                                                  |  |            |        |   |            |  
|Future cash inflows                               |  | $          | 17,034 |   |            | $
|Future costs:                                     |  |            |        |   |            |  
|Production                                        |  |            | (4,326 | ) |            |  
|Development                                       |  |            | (5,761 | ) |            |  
|                                                  |  |            |        |   |            |  
|Future net cash inflows                           |  |            | 6,947  |   |            |  
|10% discount factor                               |  |            | (4,286 | ) |            |  
|                                                  |  |            |        |   |            |  
|Standardized measure of discounted net cash flows |  | $          | 2,661  |   |            | $



Changes in the standardized
measure of discounted future net cash flows relating to estimated proved reserves for the year ended December 31, 2012, giving
effect to reserves associated with properties owned by Petroleum during the period and transferred to us in 2013, were as follows
(In thousands):



|                                               |  | 2012       |       |   | 2011       |  
|---------------------------------------------- |  | ---------- | ----- | - | ---------- | -
|                                               |  | (Restated) |       |   | (Restated) |  
|                                               |  |            |       |   |            |  
|Standardized measure at beginning of period    |  | $          | 94    |   |            | $
|                                               |  |            |       |   |            |  
|Sales, net of production costs                 |  |            | (50   | ) |            |  
|Purchases and assignments of minerals in place |  |            | 2,617 |   |            |  
|                                               |  |            |       |   |            |  
|Standardized measure at end of period          |  | $          | 2,661 |   |            | $



The estimated present value
of future cash flows relating to estimated proved reserves is extremely sensitive to prices used at any measurement period. The
average prices used for each commodity for the year ended December 31, 2012 was as follows:



|                  |  | Average Price |      
|----------------- |  | ------------- | -----
|                  |  | Oil           |      
|                  |  |               |      
|December 31, 2012 |  | $             | 89.14



Average prices for December
31, 2012 were based on the 12-month un-weighted arithmetic average of the first-day-of-the-month price for the period from January
through December during each respective calendar year.



Analysis of Reserves



The following table presents
Arabella’s estimated net proved oil and natural gas reserves and the present value of Arabella’s reserves as of December
31, 2012 and 2011 and June 30, 2013 pro-forma reserves, based on the reserve report prepared by WPC, and such reserve reports
have been prepared in accordance with the rules and regulations of the SEC. All Arabella’s proved reserves included in the
reserve reports are located in North America.



F-33







|ARABELLA
    EXPLORATION, LIMITED LIABILITY COMPANY
|---------------------------------------------------
|NOTES TO COMBINED FINANCIAL STATEMENTS             



| | 8. | SUPPLEMENTAL OIL AND GAS
                                         RESERVE INFORMATION (UNAUDITED), continued
| | -- | ------------------------------------------------------------------------------------------------------------



Analysis of Reserves, continued



|                                        |  | Proforma (3) |         |   | Historical(1) |  |         | Restated (2) | 
|--------------------------------------- |  | ------------ | ------- | - | ------------- |  | ------- | ------------ | 
|                                        |  | June 30,     |         |   | December 31,  |  |         | December 31, | 
|                                        |  | 2013         |         |   | 2012          |  |         | 2011         | 
|                                        |  |              |         |   |               |  |         |              | 
|Estimated proved developed reserves:    |  |              |         |   |               |  |         |              | 
|Oil (MBbls)                             |  |              | 113.1   |   |               |  | 7.7     |              | 
|Natural gas (MMcf)                      |  |              | 147.4   |   |               |  | 6.4     |              | 
|Natural gas liquids (MBbls)             |  |              | -       |   |               |  | -       |              | 
|Total (MBOE)                            |  |              | 137.6   |   |               |  | 8.8     |              | 
|Estimated proved undeveloped reserves:  |  |              |         |   |               |  |         |              | 
|Oil (MBbls)                             |  |              | 368.6   |   |               |  | 158.6   |              | 
|Natural gas (MMcf)                      |  |              | 673.8   |   |               |  | 370.8   |              | 
|Natural gas liquids (MBbls)             |  |              | -       |   |               |  | -       |              | 
|Total (MBOE)                            |  |              | 480.9   |   |               |  | 222.1   |              | 
|Estimated net proved reserves:          |  |              |         |   |               |  |         |              | 
|Oil (MBbls)                             |  |              | 481.8   |   |               |  | 166.3   |              | 
|Natural gas (MMcf)                      |  |              | 821.2   |   |               |  | 377.2   |              | 
|Natural gas liquids (MBbls)             |  |              | -       |   |               |  | -       |              | 
|Total (MBOE)                            |  |              | 618.6   |   |               |  | 229.2   |              | 
|Percent proved developed                |  |              | 22.2    | % |               |  | 3.8     | %            | 
|                                        |  |              |         |   |               |  |         |              | 
|Estimated probable developed reserves   |  |              |         |   |               |  |         |              | 
|Oil (MBbls)                             |  |              | -       |   |               |  | -       |              | 
|Natural gas (MMCF)                      |  |              | -       |   |               |  | -       |              | 
|Natural gas liquids (MBbls)             |  |              | -       |   |               |  | -       |              | 
|Total (MBOE)                            |  |              | -       |   |               |  | -       |              | 
|Estimated probable undeveloped reserves |  |              |         |   |               |  |         |              | 
|Oil (MBbls)                             |  |              | 2,139.6 |   |               |  | 1,414.8 |              | 
|Natural gas (MMCF)                      |  |              | 2,995.5 |   |               |  | 1,980.7 |              | 
|Natural gas liquids (MBbls)             |  |              | -       |   |               |  | -       |              | 
|Total (MBOE)                            |  |              | 2,638.9 |   |               |  | 1,744.9 |              | 
|                                        |  |              |         |   |               |  |         |              | 
|Estimated possible developed reserves   |  |              |         |   |               |  |         |              | 
|Oil (MBls)                              |  |              | -       |   |               |  | -       |              | 
|Natural gas (MMCF)                      |  |              | -       |   |               |  | -       |              | 
|Natural gas liquids (MBbls)             |  |              | -       |   |               |  | -       |              | 
|Total (MBOE)                            |  |              | -       |   |               |  | -       |              | 
|Estimated possible undeveloped reserves |  |              |         |   |               |  |         |              | 
|Oil (MBls)                              |  |              | 4,636.4 |   |               |  | 297.9   |              | 
|Natural gas (MMCF)                      |  |              | 6,575.2 |   |               |  | 417.1   |              | 
|Natural gas liquids (MBbls)             |  |              | -       |   |               |  | -       |              | 
|Total (MBOE)                            |  |              | 5,732.3 |   |               |  | 367.4   |              | 



F-34







|ARABELLA
    EXPLORATION, LIMITED LIABILITY COMPANY
|---------------------------------------------------
|NOTES TO COMBINED FINANCIAL STATEMENTS             



| | 8. | SUPPLEMENTAL OIL AND GAS
                                         RESERVE INFORMATION (UNAUDITED), continued
| | -- | ------------------------------------------------------------------------------------------------------------



Analysis of Reserves, continued



(1) Estimates
of reserves as of December 31, 2012 and 2011 and June 30, 2013 were prepared using an average price equal to the unweighted arithmetic
average of hydrocarbon prices received on a field-by-field basis on the first day of each month within the 12-month periods ended
December 31, 2012 and 2011 and June 30, 2013, respectively, in accordance with revised SEC guidelines applicable to reserves estimates
as of the end of such periods. Reserve estimates do not include any value for probable or possible reserves that may exist, nor
do they include any value for undeveloped acreage. The reserve estimates represent Arabella’s net revenue interest in Arabella’s
properties. Although Arabella believes these estimates are reasonable, actual future production, cash flows, taxes, development
expenditures, operating expenses and quantities of recoverable oil and natural gas reserves may vary substantially from these
estimates.



(2) The reserves at December
31, 2012 and 2011 have been restated, giving effect to reserves associated with properties owned by Petroleum during the period
and transferred to us in 2012 and 2013.



The foregoing reserves are
all located within the continental United States. Reserve engineering is a subjective process of estimating volumes of economically
recoverable oil and natural gas that cannot be measured in an exact manner. The accuracy of any reserve estimate is a function
of the quality of available data and of engineering and geological interpretation. As a result, the estimates of different engineers
often vary. In addition, the results of drilling, testing and production may justify revisions of such estimates. Accordingly,
reserve estimates often differ from the quantities of oil and natural gas that are ultimately recovered. Estimates of economically
recoverable oil and natural gas and of future net revenues are based on a number of variables and assumptions, all of which may
vary from actual results, including geologic interpretation, prices and future production rates and costs. Arabella has not filed
any estimates of total, proved net oil or natural gas reserves with any federal authority or agency other than the SEC.



(3) Gives effect to the properties
Petroleum acquired and transferred to Arabella in 2013.



F-35