Falcon Oil & Gas Ltd-Hungary Drilling Update

Falcon Oil & Gas Ltd. (TSX VENTURE:FO)(AIM:FOG)(ESM:FAC) ("Falcon" or the
"Company"), is pleased to announce that initial drilling operations on the
Kutvolgy-1 well have ceased, the well having reached total depth ("TD") of 3,305
metres.


Kutvolgy-1 is the first of a planned three well programme to evaluate the gas
potential of the Algyo formation in the Mako Trough. As prognosed, the top of
the Algyo formation was encountered at 2,985 metres; the well then penetrating
an alternating sequence of sandstones, siltstones and shales over a gross
interval of 320 metres to TD, with gas shows throughout. Two conventional cores
have been taken and extensive wireline logs were run. As planned the well has
been cased to TD and is now suspended while further technical evaluation is
undertaken prior to carrying out an appropriate rigless testing programme later
this year. No operational problems or accidents occurred during drilling. 


The location of the second of the three well programme will be decided after a
full evaluation of the Kutvolgy-1 well results. Operations on the second well
are expected to commence in Q4 this year.


In accordance with the terms of the agreement with NIS, announced on 14 January
2013, Falcon is fully carried, as all costs associated with this three well
drilling program are funded by NIS. Any hydrocarbon sales revenue resulting from
this program will be shared equally between Falcon and NIS.


Philip O'Quigley, CEO of Falcon commented: 

"We are pleased to confirm that our well successfully reached its target Algyo
formation and encountered hydrocarbons, and thanks to the close collaboration
with NIS, drilling was completed without any operational difficulties. I am
looking forward to the technical evaluation of the well results and then the
testing programme that will take place during Q4 2013." 


This announcement has been reviewed by Dr. Gabor Bada, Falcon's Head of
Technical Operations. Dr. Bada obtained his geology degree at the Eotvos L.
University in Budapest, Hungary and his PhD at the Vrije Aniversiteit Amsterdam,
the Netherlands. He is a member of AAPG, EAGE and SPE. Definitions in this press
release are consistent with SPE guidelines.


About the Algyo 

The Algyo is a relatively shallow play between 2,300m and 3,500m. A number of
Falcon wells have been drilled through the Algyo in recent years, some of which
encountered gas shows, but to date no well has ever tested the play concept at
an optimal location as previous wells targeted deeper intervals of up to 6,000m.



Multiple Algyo prospects have subsequently been identified by Falcon through
extensive AVO analysis. The ongoing exploration drilling program with NIS is
targeting three separate high-graded prospects.


A recent independent study by RPS Energy (January 2013) included for the first
time Prospective Resource recoverable volumes attributable to the shallow Algyo
Play. According to the RPS report, eight of the ten prospects identified by
Falcon contain 568 BCF of prospective recoverable gas resources, each with a 10%
Geological Probability of Success ("GPoS").


About Falcon Oil & Gas Ltd. 

Falcon is an international oil & gas company engaged in the acquisition,
exploration and development of conventional and unconventional oil and gas
assets, with the current portfolio spread between Australia, South Africa and
Hungary. Falcon is incorporated in British Columbia, Canada and headquartered in
Dublin, Ireland with a technical team based in Budapest, Hungary.


For further information on Falcon Oil & Gas Ltd. please visit
www.falconoilandgas.com.


About NAFTNA INDUSTRIJA SRBIJE JSC ("NIS")

NIS is one of the largest, vertically integrated oil and gas companies in
Southeast Europe, focusing on exploration and production of hydrocarbons,
refining of crude oil and sales of a broad range of petroleum products. 


For further information on NIS please visit www.nis.rs.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that
term is defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release. 


Certain information in this press release may constitute forward-looking
information. This information is based on current expectations that are subject
to significant risks and uncertainties that are difficult to predict. Actual
results might differ materially from results suggested in any forward-looking
statements. Falcon assumes no obligation to update the forward-looking
statements, or to update the reasons why actual results could differ from those
reflected in the forward looking-statements unless and until required by
securities laws applicable to Falcon. Additional information identifying risks
and uncertainties is contained in Falcon's filings with the Canadian securities
regulators, which filings are available at www.sedar.com.


FOR FURTHER INFORMATION PLEASE CONTACT: 
Falcon Oil & Gas Ltd.
+353 1 417 1900


Falcon Oil and Gas Ltd.
Philip O'Quigley
CEO
+353 87 814 7042
www.falconoilandgas.com


FTI Consulting
Billy Clegg
+44 207 269 7157


FTI Consulting
Edward Westropp
+44 207 269 7230


FTI Consulting
Natalia Erikssen
+44 207 269 9348


Davy (NOMAD & Joint Broker)
John Frain / Anthony Farrell
+353 1 679 6363


GMP Securities Europe LLP (Joint Broker)
Rob Collins / Alexandra Carse
+44 20 7647 2800


Cantor Fitzgerald Europe (Joint Broker)
Stewart Dickson / Richard Redmayne / Julian Erleigh
+44 207 894 7000
Falcon Oil and Gas (TSXV:FO)
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