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RISK FACTORS — ENVIRONMENTAL, SOCIAL AND GOVERNANCE AND CLIMATE-RELATED RISKS

Draft Supplement to the Offering Memorandum dated May 14, 2025

$850,000,000 Aggregate Principal Amount 9.375% Senior Secured Notes due 2032

Dunmore Energy Holdings Ltd. (a Cayman Islands exempted company)

and

Dunmore upstream Finance Corp. (a Delaware corporation, as Co-Issuer)

Prepared by Calderwood & Harkness LLP, 425 Lexington Avenue, New York, NY 10017. Matter No. 1016-00003. Drafted by Claire Dempsey (working associate) under the supervision of Jennifer Kwon (responsible partner, Capital Markets). ESG data sourced from Barrisford Advisory Group LLC (Nathan Reyes Linley CPAs LLP, lead consultant), 1700 K Street NW, Suite 900, Washington, DC 20006. This section is intended to be inserted in the "Risk Factors" section of the Final Offering Memorandum (Rule 144A / Regulation S) alongside the companion sanctions/OFAC risk factors supplement. In the final OM layout, this section should be typeset to follow the sanctions, OFAC, and anti-corruption risk factors.

DRAFT — FOR DISCUSSION PURPOSES ONLY — SUBJECT TO REVISION

Introductory Note

The following risk factors address environmental, social and governance ("ESG") matters, climate-related risks, and related regulatory developments that may affect Dunmore Energy Holdings Ltd., together with its subsidiaries (collectively, "Dunmore," the "Company," "we," "us," or "our"), and, consequently, the 9.375% Senior Secured Notes due 2032 (the "Notes") and the related guarantees (the "Guarantees"). These risk factors supplement, and should be read together with, all other risk factors set forth in the Offering Memorandum dated May 14, 2025 (the "Offering Memorandum"), including, without limitation, those risk factors addressing sanctions, Office of Foreign Assets Control ("OFAC"), and anti-corruption risks contained in the companion supplement thereto.

For further detail on Dunmore's ESG programs, metrics, and initiatives, investors should refer to the section of the Offering Memorandum captioned "Environmental and Social Responsibility," which provides additional information regarding Dunmore's environmental compliance framework, community engagement initiatives, governance structures, and sustainability-related targets and metrics.

These risk factors contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). All statements other than statements of historical fact contained in these risk factors, including, without limitation, statements regarding Dunmore's ESG strategy, net-zero commitment, planned investments, anticipated regulatory developments, and expected operational impacts of climate change, are forward-looking statements. Investors are directed to the section of the Offering Memorandum captioned "Cautionary Statement Regarding Forward-Looking Statements" for additional information regarding the identification of forward-looking statements and the risks and uncertainties inherent therein. In addition, the section captioned "Cautionary Statement Regarding Forward-Looking ESG Statements" set forth below contains cautionary language specific to forward-looking ESG-related statements included in this supplement.

Investing in the Notes involves significant risk. Prospective investors should carefully consider all of the risk factors described in the Offering Memorandum, including those set forth below, before making an investment decision with respect to the Notes. If any of the following risks materialize, Dunmore's business, financial condition, results of operations, and prospects could be materially and adversely affected, and the trading price of the Notes could decline, resulting in a loss of all or part of an investor's investment.

Risk Factor 1: Climate-Transition Risk — Regulatory and Policy Changes May Adversely Affect Dunmore's Business, Financial Condition, and Results of Operations

Dunmore's core business is the exploration, development, production, and marketing of crude oil and natural gas through upstream and midstream operations. Dunmore's principal producing interests include Oil Mining Lease 47 ("OML 47") and Oil Mining Lease 63 ("OML 63") in the Niger Delta region of Nigeria, the Cayar Offshore Block in Senegal, and deepwater leases in the Green Canyon and Garden Banks areas of the Gulf of Mexico (the "GoM"). These hydrocarbon-focused operations represent the substantial majority of Dunmore's consolidated revenue and earnings. For the fiscal year ended December 31, 2024 ("FY 2024"), Dunmore reported revenue of approximately $2,140,000,000 and Adjusted EBITDA of approximately $816,000,000, virtually all of which was derived from hydrocarbon production and sales, including associated midstream gathering and processing activities.

Governments and intergovernmental organizations worldwide have adopted, and continue to develop, a broad range of initiatives and regulatory programs intended to reduce greenhouse gas ("GHG") emissions and mitigate the effects of climate change. The Paris Agreement, adopted in December 2015 under the United Nations Framework Convention on Climate Change, establishes a global framework for limiting average temperature increases to well below 2°C above pre-industrial levels, with efforts to limit the increase to 1.5°C. National and sub-national governments have implemented, or are in the process of implementing, range measures to achieve the objectives of the Paris Agreement and related climate goals, including carbon-pricing mechanisms (such as carbon taxes and cap-and-trade programs), emissions trading schemes, methane-reduction regulations, flaring restrictions, fuel efficiency and clean energy standards, and mandates for disclosure of climate-related risks and emissions. These initiatives, individually or in the aggregate, may impose significant additional costs on Dunmore's operations, restrict Dunmore's ability to conduct its business as currently planned, reduce the demand for Dunmore's products, or otherwise have a material adverse effect on Dunmore's business, financial condition, and results of operations.

United States Regulatory Developments. Dunmore's GoM operations, which are conducted through its subsidiaries Dunmore Gulf Operations LLC and Dunmore Midstream Holdings Inc., are subject to a comprehensive regulatory framework administered by federal and state authorities. The U.S. Securities and Exchange Commission (the "SEC") has proposed, and may adopt in final form, rules requiring registrants to disclose extensive information regarding GHG emissions, climate-related financial risks, governance of climate-related risks, and transition plans. While the ultimate scope and timing of such rules remain uncertain, compliance with any final SEC climate disclosure requirements could impose significant additional costs on Dunmore and its subsidiaries, require changes to internal data collection and reporting systems, and expose Dunmore to increased litigation risk in the event that disclosures are deemed to be inaccurate or incomplete. In addition, the U.S. Environmental Protection Agency (the "EPA") has adopted methane emission standards applicable to oil and gas operations, including those in the GoM, which may require Dunmore to install additional emissions-monitoring and emissions-reduction equipment, modify operational practices, and incur ongoing monitoring and compliance costs. The Bureau of Ocean Energy Management ("BOEM") and the Bureau of Safety and Environmental Enforcement ("BSEE") continue to develop and refine regulations applicable to deepwater operations, including requirements related to environmental protection, well integrity, and decommissioning that may be influenced by climate-related policy considerations. Changes in U.S. federal administration and policy priorities could result in either more or less stringent environmental regulation, creating uncertainty for long-term planning and investment decisions.

Nigerian Regulatory Developments. Dunmore's operations in Nigeria, which are conducted through its subsidiary Dunmore Nigeria E&P Ltd., are subject to the Nigerian Petroleum Industry Act (the "PIA"), enacted in August 2021, and related regulations. The PIA contains provisions addressing environmental remediation, gas flaring penalties, and host community development obligations that impose significant compliance burdens on oil and gas operators in Nigeria. Gas flaring penalties under the PIA are structured to escalate over time and are designed to incentivize the reduction and elimination of routine gas flaring. Dunmore's operations at OML 47 and OML 63 remain subject to flaring in certain circumstances due to infrastructure constraints, and escalating penalties could materially increase operating costs. The PIA also requires operators to establish host community development trusts funded by a percentage of operating expenditures, which represents an additional cost. The Department of Petroleum Resources ("DPR"), the Calderon Group ("NNPC"), and successor regulatory authorities continue to develop implementing regulations and guidance under the PIA, and the scope and pace of these regulatory developments remain uncertain. Additional environmental legislation or regulation in Nigeria, whether at the federal or state level, could impose further obligations on Dunmore's Nigerian operations, including requirements for environmental impact assessments, biodiversity offsets, emissions monitoring, or water management.

Senegalese Regulatory Developments. Dunmore's operations in Senegal, conducted through its subsidiary Dunmore Senegal S.A., are governed by the production sharing contract (the "Cayar PSC") for the Cayar Offshore Block and are subject to environmental permit conditions imposed by the Senegalese Ministère de l'Énergie and related governmental authorities. Changes in Senegalese environmental legislation could trigger renegotiation or modification of the terms of the Cayar PSC, potentially resulting in more onerous environmental obligations, increased royalty or tax burdens, or requirements for additional environmental mitigation measures. Senegal is in the early stages of developing its regulatory framework for offshore oil and gas operations, and there is significant uncertainty regarding the future direction and stringency of environmental regulation in this jurisdiction. Any material changes to the regulatory framework could adversely affect the economics of the Cayar Offshore Block, including the planned Phase II development, to which approximately $250,000,000 of the net proceeds of the Notes are expected to be allocated.

EU and UK Regulatory Developments. Dunmore Trading Ltd., a private limited company incorporated in England and Wales and Dunmore's offtake and trading arm, may be affected by European Union and United Kingdom climate and environmental regulations. The EU Carbon Border Adjustment Mechanism ("CBAM"), which imposes costs on the embedded carbon content of certain imported goods, and the UK Emissions Trading Scheme ("UK ETS"), which caps GHG emissions from certain sectors and requires participants to hold emissions allowances, could increase the costs associated with Dunmore Trading Ltd.'s commercial activities or reduce the competitiveness of Dunmore's products in European markets. To the extent that EU or UK regulations impose additional reporting, compliance, or financial obligations on Dunmore Trading Ltd. or affect market pricing for Dunmore's crude oil and natural gas, such regulations could have an adverse effect on Dunmore's consolidated results of operations.

Carbon Taxes and Emissions Caps. The imposition of carbon taxes, emissions caps, or other carbon-pricing mechanisms in jurisdictions in which Dunmore operates or sells its products could increase Dunmore's operating costs, reduce demand for fossil fuels, or both. Even in the absence of binding regulations in Dunmore's principal operating jurisdictions, the adoption of carbon-pricing mechanisms in major consuming markets could depress global commodity prices by reducing overall demand for crude oil and natural gas, thereby adversely affecting Dunmore's revenue and profitability.

Transition Away from Fossil Fuels. The broader energy transition — characterized by a global shift away from fossil fuels and toward renewable energy sources, electrification, energy efficiency, and other low-carbon alternatives — could result in a structural decline in global demand for crude oil and natural gas over the medium to long term. Such a decline could depress commodity prices and adversely affect Dunmore's revenue, proved reserves valuations, and ability to service the Notes. As of December 31, 2024, Dunmore's total proved reserves were 345.8 million barrels of oil equivalent ("MMboe"), with a standardized measure of discounted future net cash flows (PV-10) of approximately $6,700,000,000, as reported by Dunmore's independent petroleum engineering consultants, Duval Howard & Partners. A sustained decline in commodity prices resulting from the energy transition could materially reduce the value of these proved reserves and the associated PV-10, potentially resulting in impairment charges and adversely affecting the value of the Collateral securing the Notes.

Stranded Asset Risk. If the energy transition accelerates faster than currently anticipated — due to technological breakthroughs, more aggressive regulatory action, shifts in consumer behavior, or other factors — certain of Dunmore's hydrocarbon assets could become uneconomic to develop or produce before the end of their expected productive lives, a scenario commonly referred to as "stranded assets." Such a development could result in write-downs, impairments, or abandonment of assets, which would adversely affect Dunmore's financial condition and the value of the Collateral securing the Notes.

Renewable Energy Portfolio. Dunmore's nascent renewable energy portfolio, consisting of a 220-megawatt ("MW") solar portfolio in West Texas held by Dunmore Renewables LLC, represents a small fraction of Dunmore's overall asset base and revenue. There can be no assurance that Dunmore will be able to grow its renewable energy portfolio at a pace sufficient to offset potential declines in hydrocarbon revenue resulting from the energy transition, regulatory changes, or shifts in market demand. The development and scaling of renewable energy operations involve significant capital requirements, technological risks, permitting challenges, and market uncertainties that may limit the pace and extent of diversification.

Risk Factor 2: Climate-Transition Risk — Dunmore's Net-Zero by 2050 Commitment May Not Be Achieved, and Failure to Meet or Perceived Failure to Meet Such Commitment Could Have Adverse Consequences

Dunmore has publicly committed to achieving net-zero GHG emissions across its operations by 2050 (the "Net-Zero Commitment"). The Net-Zero Commitment is aspirational and forward-looking in nature, and its achievement is dependent upon numerous factors, many of which are beyond Dunmore's control, including, without limitation, the pace and direction of technological developments (including carbon capture, utilization, and storage ("CCUS") technologies), the availability and cost of carbon offsets and carbon credits, the evolution of regulatory frameworks in the jurisdictions in which Dunmore operates, prevailing commodity prices and market conditions, and the broader trajectory of the global energy transition.

As of FY 2024, Dunmore's GHG emissions profile is as follows, based on data prepared by Barrisford Advisory Group LLC:

Dunmore's methane flaring intensity was 3.8 cubic meters per barrel of oil equivalent ("m³/boe") for FY 2024, compared to an industry average of approximately 5.1 m³/boe. While Dunmore's flaring intensity is below the industry average, gas flaring remains a significant source of GHG emissions and is subject to increasing regulatory scrutiny, particularly in Nigeria under the PIA. Dunmore has not publicly disclosed Scope 3 GHG emissions (emissions occurring in the value chain, including end-use combustion of Dunmore's products by customers), which are expected to be substantially larger than Scope 1 and Scope 2 emissions combined. The absence of comprehensive Scope 3 data may limit stakeholders' ability to assess the full climate impact of Dunmore's operations and the feasibility of the Net-Zero Commitment.

There can be no assurance that Dunmore will achieve the intermediate milestones necessary to remain on a trajectory consistent with the Net-Zero Commitment, or that the 2050 target itself will be met. The pathway to net-zero for an upstream and midstream oil and gas company is inherently uncertain, and the technological, regulatory, and market conditions required to achieve such a target may not materialize on the timeline or at the scale assumed.

Failure to achieve, or to demonstrate meaningful progress toward, the Net-Zero Commitment could have a number of adverse consequences, including, without limitation:

(i) Reputational Harm. Perceived failure to meet climate commitments could damage Dunmore's reputation among investors, lenders, employees, regulators, host communities, and the general public, particularly as stakeholder expectations regarding corporate climate action continue to intensify.

(ii) Increased Cost of Capital. A growing number of institutional investors and financial institutions have adopted ESG-related investment criteria, exclusion lists, or engagement policies that target companies perceived to be lagging in their climate performance. Failure to demonstrate credible progress on the Net-Zero Commitment could increase Dunmore's cost of capital, reduce investor demand for the Notes, and limit Dunmore's access to financing markets.

(iii) Negative Ratings Actions. Credit rating agencies, including those that have provided preliminary ratings for the Notes (Lodestar Ratings International: B2 / Stable; Veridian Credit Assessments Inc.: B+ / Stable), are increasingly incorporating ESG factors into their ratings methodologies. A failure to meet the Net-Zero Commitment, or the perception of such failure, could contribute to negative ratings actions, which would increase Dunmore's borrowing costs and could trigger adverse consequences under the terms of the Indenture governing the Notes or the existing credit facilities.

(iv) Litigation Risk. The failure or perceived failure to meet publicly stated climate commitments could expose Dunmore to litigation, including claims alleging misleading or deceptive statements regarding climate performance, greenwashing, or breach of fiduciary duty.

Investor expectations regarding ESG performance and climate commitments are evolving rapidly and may exceed Dunmore's ability to deliver. Standards and frameworks for evaluating corporate climate performance are not yet uniform, and different stakeholders may apply different metrics, benchmarks, and expectations, making it difficult for Dunmore to satisfy all constituencies simultaneously. Moreover, certain investors and advocacy organizations have adopted increasingly prescriptive positions regarding the pace and scope of decarbonization, including calls for oil and gas companies to curtail hydrocarbon production on timelines that may be inconsistent with Dunmore's business plan, contractual obligations, and the interests of holders of the Notes.

The costs of implementing decarbonization strategies — including investments in emissions-reduction technologies, carbon capture, operational efficiency improvements, methane abatement, and the development of renewable energy assets — could be material and may divert capital from Dunmore's core hydrocarbon development activities. In particular, approximately $250,000,000 of the net proceeds of the Notes are expected to be allocated to the Cayar Offshore Phase II development, a significant hydrocarbon investment that may be viewed as inconsistent with the Net-Zero Commitment by certain stakeholders. There is an inherent tension between the capital requirements of Dunmore's hydrocarbon development program and the investments necessary to pursue decarbonization, and there can be no assurance that Dunmore will be able to balance these competing priorities in a manner that satisfies all stakeholders or achieves the Net-Zero Commitment.

Risk Factor 3: Physical Climate Risk — Dunmore's Operations Are Exposed to Physical Risks from Climate Change

Dunmore's assets and operations span multiple geographies with distinct physical climate exposures. The physical effects of climate change — including rising temperatures, sea-level rise, increased frequency and severity of extreme weather events, changes in precipitation patterns, and other meteorological and environmental phenomena — could adversely affect Dunmore's operations, infrastructure, financial condition, and results of operations.

Gulf of Mexico. Dunmore's deepwater operations in the Green Canyon and Garden Banks areas of the GoM, conducted through Dunmore Gulf Operations LLC and Dunmore Midstream Holdings Inc., are exposed to hurricanes and tropical storms, the frequency and severity of which scientific evidence suggests may increase as a result of climate change. Hurricanes and tropical storms can cause extended production shut-ins, physical damage to offshore platforms, subsea wellheads, pipelines, processing facilities, and floating production systems, as well as disruptions to transportation and logistics. The GoM region has historically experienced significant hurricane-related production outages and infrastructure damage, and future events could be more severe or frequent than historical patterns would suggest. The costs of repairing or replacing damaged infrastructure, the revenue lost during production interruptions, and the potential for environmental remediation obligations arising from storm-related releases could be substantial.

Niger Delta, Nigeria. Dunmore's operations at OML 47 and OML 63 in the Niger Delta region of Nigeria, operated by Dunmore Nigeria E&P Ltd., are located in a low-lying coastal environment that is vulnerable to a range of physical climate impacts, including coastal flooding, sea-level rise, saltwater intrusion, and extreme precipitation events. These phenomena could adversely affect onshore and shallow-water production infrastructure, flow stations, gathering pipelines, and export terminals, resulting in production disruptions, infrastructure damage, and environmental contamination requiring remediation. The Niger Delta region is already subject to significant environmental challenges, and climate-related exacerbation of flooding and erosion could compound existing risks and increase the frequency and severity of operational disruptions.

Cayar Offshore Block, Senegal. Dunmore's operations at the Cayar Offshore Block in Senegal, operated by Dunmore Senegal S.A., include coastal staging areas, logistics bases, and marine infrastructure that are exposed to sea-level rise, storm surge, and coastal erosion. While the offshore production facilities themselves are designed to withstand marine environmental conditions, the onshore logistics and support infrastructure that is critical to the operation of the Cayar Offshore Block may be vulnerable to climate-related impacts. Any damage to or disruption of coastal staging and logistics infrastructure could delay development activities, interrupt production, and increase costs.

West Texas Solar Portfolio. Dunmore's 220 MW solar portfolio in West Texas, held by Dunmore Renewables LLC, is exposed to physical climate risks distinct from those affecting Dunmore's hydrocarbon operations. Extreme heat events can reduce the efficiency and output of solar photovoltaic panels, while hailstorms can cause physical damage to solar panels and associated electrical infrastructure. Wildfire risk in West Texas, which may be exacerbated by climate change, could threaten solar facilities, access roads, and transmission interconnections. While the solar portfolio represents a relatively small portion of Dunmore's overall asset base, physical damage or production losses at these facilities could impair the value of these assets and adversely affect Dunmore's diversification strategy.

Insurance and Financial Impacts. Physical damage to Dunmore's assets resulting from climate-related events could give rise to production interruptions, environmental remediation obligations, increased insurance premiums, deductibles, and exclusions, and capital expenditure requirements for repairs, replacements, and resilience improvements. Insurance coverage for climate-related events may become more expensive, subject to higher deductibles, or less available as insurers reassess their exposure to climate-related risks. The assignment of insurance proceeds forms part of the collateral package securing the Notes; any reduction in the scope, availability, or adequacy of insurance coverage could adversely affect the value of the Collateral and the recovery available to holders of the Notes in the event of a default.

Supply Chain Disruptions. Climate-related disruptions to Dunmore's supply chain — including the availability of drilling rigs, completion equipment, maintenance services, transportation and logistics, and qualified personnel — could delay development activities, increase costs, and reduce production. Such disruptions may arise from extreme weather events affecting ports, shipyards, manufacturing facilities, or transportation routes, or from broader market dislocations resulting from the cumulative impact of climate-related events across the oil and gas industry.

Capital Expenditure Implications. For FY 2024, Dunmore's consolidated capital expenditures were approximately $387,000,000. Dunmore may need to increase capital expenditures in future periods to address climate adaptation and resilience measures, including hardening of physical infrastructure, relocation of vulnerable assets, installation of flood protection systems, and upgrades to emergency response capabilities. Such additional capital expenditures, to the extent they are required, could reduce the capital available for hydrocarbon development, renewable energy investment, debt service, and other corporate purposes, and could adversely affect Dunmore's financial condition and its ability to comply with covenants under the Indenture governing the Notes.

Risk Factor 4: Evolving ESG Regulatory and Disclosure Landscape — New or Changing Requirements Could Increase Compliance Costs and Litigation Risk

The regulatory landscape for ESG disclosure and reporting is rapidly evolving across all jurisdictions in which Dunmore operates, and the pace and direction of regulatory developments remain highly uncertain. Dunmore is subject to, or may in the future become subject to, range ESG-related disclosure and reporting requirements imposed by governmental authorities, securities regulators, stock exchanges, and other standard-setting bodies.

SEC Climate Disclosure Rules. The SEC has proposed, and may adopt in final form, rules that would require public companies and issuers to provide enhanced disclosure of GHG emissions (including Scope 1, Scope 2, and potentially Scope 3 emissions), climate-related financial risks and their impact on business strategy and financial planning, governance of climate-related risks, and climate transition plans. While the final scope and effective date of any such rules remain uncertain, compliance could impose substantial costs on Dunmore, including costs associated with the development and implementation of emissions measurement and data management systems, internal controls over ESG data, third-party verification and assurance, and the preparation and filing of additional disclosures. Even in the absence of final SEC rules, Dunmore may face pressure from investors, rating agencies, and market participants to provide climate-related disclosures consistent with emerging standards and frameworks.

International Frameworks. Several international frameworks and standard-setting bodies have developed or are developing ESG-related disclosure standards that are relevant to Dunmore and its investors. These include the Task Force on Climate-related Financial Disclosures ("TCFD"), the International Sustainability Standards Board ("ISSB") of the IFRS Foundation (which has issued IFRS S1 and IFRS S2, addressing general sustainability-related and climate-related disclosure requirements, respectively), and the Sustainability Accounting Standards Board ("SASB"). While these frameworks are converging in certain respects, they are not yet fully harmonized, and Dunmore may face overlapping, duplicative, and potentially inconsistent disclosure requirements across different frameworks and jurisdictions. The cost and complexity of preparing disclosures that satisfy multiple frameworks could be significant.

EU and UK Regulatory Developments. The EU Corporate Sustainability Reporting Directive ("CSRD") and the EU Taxonomy Regulation impose detailed sustainability reporting and classification requirements on companies with activities in the European Union. While Dunmore is not directly subject to the CSRD, Dunmore Trading Ltd.'s operations in England and Wales, and European investor expectations regarding ESG disclosure, may create indirect pressure on Dunmore to align its reporting with EU standards. Similarly, the UK government has announced plans to implement sustainability disclosure requirements consistent with the ISSB standards, which could affect Dunmore Trading Ltd. and influence investor expectations regarding Dunmore's consolidated ESG reporting.

Other Jurisdictions. Regulatory authorities in Nigeria, Senegal, and the Cayman Islands may adopt their own ESG reporting and disclosure requirements. While such requirements are currently less developed than those in the United States, the EU, and the UK, the trend toward mandatory ESG disclosure is global, and Dunmore could face additional compliance obligations in these jurisdictions in the future.

Compliance Costs and Data Infrastructure. Compliance with new or expanded ESG disclosure requirements could require significant investment in data collection and management systems, internal controls and processes, employee training, and third-party assurance services. Currently, Dunmore's ESG data is prepared by Barrisford Advisory Group LLC, a third-party ESG advisory firm, but is not independently audited or subject to third-party assurance. Future regulatory requirements may mandate independent assurance of ESG data, which would increase compliance costs and could reveal data quality or methodological issues that require remediation. There can be no assurance that Dunmore's current data infrastructure and reporting capabilities will be sufficient to meet future regulatory requirements.

Enforcement Actions and Litigation Risk. Failure to comply with evolving ESG disclosure requirements could result in enforcement actions by securities regulators, including the SEC, the UK Financial Conduct Authority, and other regulatory authorities, as well as fines, penalties, and other sanctions. In addition, Dunmore could face private litigation, including securities fraud claims, alleging that its ESG-related disclosures are inaccurate, incomplete, or misleading. The Offering Memorandum's ESG-related disclosures, including the section captioned "Environmental and Social Responsibility" and these risk factors, have been prepared based on data as of FY 2024 using methodologies and assumptions that Dunmore believes to be reasonable. However, there is no assurance that Dunmore's current ESG data collection and reporting methodology will satisfy future regulatory requirements, and any revision or restatement of ESG data could create disclosure challenges and increase litigation risk.

Risk Factor 5: Reputational Risk — Negative ESG Perceptions Could Impair Access to Capital and Business Relationships

There is a growing focus by investors, lenders, regulators, credit rating agencies, proxy advisory firms, ESG rating providers, and other stakeholders on the ESG performance of companies in the oil and gas sector. This increased scrutiny reflects broader societal concerns regarding climate change, environmental protection, social responsibility, and corporate governance, and has given rise to a range of initiatives, policies, and market practices that may adversely affect Dunmore.

Dunmore's majority owner, Harborview Capital Partners Fund VI, L.P. (holding approximately 62.4% of Dunmore's equity), and its co-investors, including Solstice Infrastructure Fund LP (approximately 11.1%) and Alderman Family Office LLC (approximately 8.2%), may themselves face pressure from their own limited partners, investors, and stakeholders regarding the ESG performance of their portfolio companies, including Dunmore. Such pressure could influence the investment strategies, capital allocation decisions, and exit plans of Dunmore's equity sponsors, potentially in ways that are adverse to the interests of holders of the Notes.

Negative media coverage, activist campaigns, adverse ESG ratings or scores, inclusion on divestment or exclusion lists, or other negative ESG-related perceptions could have a number of adverse effects on Dunmore, including, without limitation:

(i) Secondary Market for the Notes. Negative ESG perceptions could reduce demand for the Notes in the secondary market, impairing liquidity and potentially reducing the trading price of the Notes.

(ii) Refinancing Risk. Negative ESG perceptions could increase the cost or reduce the availability of refinancing for the Notes upon maturity or for Dunmore's existing $750,000,000 asset-based lending facility with Velthorn National Bank, N.A. (of which approximately $470,000,000 was drawn as of the date hereof). Financial institutions are increasingly incorporating ESG criteria into their lending and underwriting decisions, and Dunmore's ability to access credit markets on favorable terms may be impaired by adverse ESG perceptions.

(iii) Employee Attraction and Retention. Negative ESG perceptions could impair Dunmore's ability to attract and retain qualified employees, including technical, operational, and managerial personnel. As of FY 2024, Dunmore employed approximately 3,400 people worldwide, many of whom possess specialized skills critical to Dunmore's operations. Competition for talent in the oil and gas industry is intense, and ESG considerations are an increasingly important factor in employment decisions, particularly among younger workers.

(iv) Business Relationships. Negative ESG perceptions could adversely affect Dunmore's relationships with joint venture partners, host governments, regulatory authorities, suppliers, contractors, and communities, potentially resulting in the loss of business opportunities, unfavorable contract terms, or increased regulatory scrutiny.

Community Relations. Dunmore's community development expenditures in Nigeria totaled approximately $14.2 million in FY 2024, including contributions to host community development trusts, infrastructure projects, educational initiatives, and other community programs. While Dunmore believes these expenditures are consistent with its obligations under the PIA and its contractual commitments, there can be no assurance that host communities, non-governmental organizations ("NGOs"), regulatory authorities, or other stakeholders will view Dunmore's community development spend as adequate. Perceptions of insufficient community engagement or investment could lead to operational disruptions, protests, blockades, community-relations disputes, or other actions that could interrupt production, delay development activities, and adversely affect Dunmore's reputation and results of operations, particularly in the Niger Delta, where community-relations issues have historically been a significant source of operational risk for oil and gas operators.

Environmental Incidents. Environmental incidents, including oil spills, gas releases, well blowouts, pipeline leaks, and other accidental discharges, at any of Dunmore's operations could attract significant negative public, media, and regulatory attention and result in enforcement actions, penalties, remediation costs, and litigation, the financial impact of which could be disproportionate to the direct costs of the incident itself. The reputational harm from a significant environmental incident could persist long after the incident has been remediated and could adversely affect Dunmore's relationships with regulators, communities, investors, and other stakeholders.

Risk Factor 6: Environmental Remediation and Decommissioning Liabilities May Be Significant

Dunmore's operations are subject to extensive environmental laws and regulations in each jurisdiction in which it operates, which impose obligations with respect to the prevention and remediation of environmental contamination, the management and disposal of hazardous substances and waste, the protection of air and water quality, and the decommissioning and restoration of production facilities and producing areas at the end of their economic life.

Nigeria. Nigerian law and the provisions of the PIA require operators to undertake progressive abandonment and decommissioning planning for oil mining leases and associated production facilities. Dunmore Nigeria E&P Ltd. is required to maintain decommissioning plans and to make periodic financial provisions for the eventual abandonment and decommissioning of facilities associated with OML 47 and OML 63. The Niger Delta region has a long history of environmental contamination associated with oil and gas operations, including legacy contamination from historical spills and operational discharges, and Dunmore may be required to undertake remediation of contaminated sites, whether or not such contamination resulted from Dunmore's own activities. The scope and cost of remediation and decommissioning obligations in Nigeria are subject to significant uncertainty, including uncertainty regarding the evolution of legal requirements, the identification of previously unknown contamination, and the standards of remediation that may be required by regulatory authorities.

Senegal. The Cayar PSC includes decommissioning obligations that require Dunmore Senegal S.A. to decommission and remove offshore production facilities and to restore the seabed at the conclusion of production activities. The costs of offshore decommissioning in deepwater environments can be substantial and are subject to significant variability depending on the nature and scale of the facilities, the water depth, prevailing market conditions for decommissioning services, and applicable regulatory requirements. As the Cayar Offshore Block is in a relatively early stage of development, the full scope of decommissioning obligations is not yet determinable, but such obligations could be material.

Gulf of Mexico. BOEM regulations require operators of offshore oil and gas leases in the GoM to post decommissioning bonds or provide other forms of financial assurance to guarantee the performance of decommissioning obligations. The bonding and financial assurance requirements applicable to GoM leases have been subject to periodic review and revision by BOEM, and any increase in bonding requirements could impose additional costs on Dunmore Gulf Operations LLC or require the allocation of additional Collateral or other financial resources to satisfy such requirements.

Changes in Law and Scope of Liabilities. Estimated decommissioning and environmental remediation liabilities may increase as a result of changes in applicable law, new discoveries of previously unknown contamination, increases in the scope of required remediation, changes in remediation standards or technologies, and increases in the costs of labor, materials, and services required for remediation and decommissioning activities. Environmental laws and regulations have historically tended to become more stringent over time, and Dunmore should expect that its environmental compliance obligations will increase in scope and cost in the future.

Any material increase in environmental remediation or decommissioning liabilities could reduce the value of the Collateral securing the Notes, increase Dunmore's cash outflows, reduce the funds available for debt service, and adversely affect Dunmore's ability to comply with the financial and other covenants contained in the Indenture governing the Notes. To the extent that decommissioning or remediation obligations constitute priority claims or liens on Dunmore's assets under applicable law, such claims could reduce recoveries available to holders of the Notes in the event of a default.

Risk Factor 7: ESG-Related Litigation Risk

Companies in the oil and gas sector face a growing volume and expanding scope of litigation related to climate change and ESG matters. Climate-related litigation includes, without limitation, claims seeking damages for alleged contribution to global warming and its effects (including property damage, personal injury, and economic loss), challenges to environmental permits and governmental approvals for oil and gas projects, securities fraud claims based on alleged misstatements or omissions regarding climate risks or ESG metrics, and derivative actions alleging breach of fiduciary duty by directors and officers in connection with the management of climate-related risks.

Dunmore could be subject to litigation in multiple jurisdictions, including the United States (both federal and state courts), Nigeria, Senegal, England and Wales, and the Cayman Islands, alleging, among other things:

• inadequate disclosure of climate-related risks in the Offering Memorandum, annual reports, or other public communications;

• misleading ESG-related claims or representations, commonly referred to as "greenwashing," including in connection with the Net-Zero Commitment;

• failure to take adequate steps to mitigate the climate impacts of Dunmore's operations;

• contribution to global warming and associated environmental and social harm;

• breach of environmental laws, regulations, permits, or contractual obligations; or

• breach of fiduciary duty by Dunmore's directors and officers in connection with the oversight of climate-related risks.

Securities law claims could allege that the Offering Memorandum's ESG-related disclosures, including the section captioned "Environmental and Social Responsibility" and these risk factors, are materially misleading by reason of misstatement, omission, or failure to disclose material information regarding Dunmore's climate-related risks, emissions, or ESG performance. While Dunmore believes that the ESG-related disclosures contained in the Offering Memorandum are accurate and adequate in all material respects, there can be no assurance that claims will not be brought by holders of the Notes, regulatory authorities, or other parties, or that such claims, if brought, will not result in material liability, settlement costs, or other adverse consequences.

The defense of ESG-related litigation can be costly, time-consuming, and disruptive to Dunmore's business operations, regardless of the ultimate outcome. Legal fees, expert costs, discovery expenses, and management time devoted to litigation defense can be substantial. Potential liability from adverse judgments, settlements, or consent decrees could be material and is inherently difficult to predict. ESG-related litigation may also generate negative publicity that compounds the reputational risks described elsewhere in these risk factors. The insurance coverage available to Dunmore for ESG-related litigation may be limited, and there can be no assurance that Dunmore's existing insurance policies will cover all defense costs or potential liability arising from such litigation.

Risk Factor 8: Social and Governance Risks — Human Rights, Community Relations, and Governance Matters Could Affect Operations

Dunmore's operations in Nigeria and Senegal involve extensive engagement with local communities, indigenous populations, and government stakeholders in jurisdictions where human rights, labor, governance, and rule-of-law risks are elevated relative to more developed markets. The social and governance risks associated with operating in these environments are complex and multifaceted and could have a material adverse effect on Dunmore's business, financial condition, results of operations, and reputation.

Human Rights. International frameworks, including the United Nations Guiding Principles on Business and Human Rights and the OECD Guidelines for Multinational Enterprises, establish expectations for companies to respect human rights throughout their operations and supply chains. Dunmore's operations in the Niger Delta and Senegal are conducted in regions where human rights concerns — including issues related to land rights, environmental justice, security practices, labor conditions, and community displacement — have been the subject of significant domestic and international attention. While Dunmore has adopted policies and procedures designed to promote respect for human rights in its operations, there can be no assurance that such policies will be effective in all circumstances or that Dunmore's activities will not give rise to human rights-related claims, complaints, or litigation.

Governance. Dunmore's Board of Directors is chaired by Lady Constance Harrowby, an independent director and former UK Energy Minister, and Dunmore's Chief Executive Officer is Marcus Ellingham. Under their leadership, Dunmore has implemented governance frameworks, policies, and procedures designed to oversee ESG-related risks and to promote ethical business conduct, regulatory compliance, and stakeholder engagement. However, no governance framework can guarantee the prevention or detection of all ESG-related compliance failures, misconduct, or operational incidents. The effectiveness of Dunmore's governance structures depends on the integrity and diligence of individual directors, officers, and employees, and the complexity and geographic dispersion of Dunmore's operations create inherent challenges for governance and oversight.

Supply Chain and Contractor Risks. Dunmore relies on a large number of third-party contractors, service providers, and suppliers to support its exploration, development, production, and midstream operations. The ESG practices, labor standards, human rights records, and environmental compliance of these third parties may not meet Dunmore's own standards or the expectations of Dunmore's investors and other stakeholders. Violations of environmental, labor, human rights, or anti-corruption laws by Dunmore's contractors or suppliers could expose Dunmore to legal liability, regulatory sanctions, and reputational harm, even where Dunmore itself has not engaged in wrongful conduct. Dunmore's ability to monitor and enforce ESG compliance across its supply chain is limited, particularly in jurisdictions with weak regulatory enforcement and limited transparency.

Anti-Bribery and Anti-Corruption. Anti-bribery and anti-corruption considerations, which intersect with broader governance and ESG risks, are addressed in detail in the companion sanctions, OFAC, and anti-corruption risk factors supplement. Investors should review those risk factors in conjunction with the social and governance risks described herein.

Social License to Operate. Dunmore's ability to maintain a social license to operate — that is, the ongoing acceptance and approval of Dunmore's operations by local communities, host governments, and other stakeholders — is essential to the continuity of Dunmore's business. Failure to maintain an adequate social license to operate, whether as a result of environmental incidents, community grievances, human rights concerns, governance failures, or other factors, could result in the revocation or non-renewal of exploration or production licenses, the denial of environmental or operating permits, contractual defaults under production sharing contracts ("PSCs") and joint operating agreements ("JOAs"), community protests and operational disruptions, and other consequences that could materially and adversely affect Dunmore's business and the value of the Collateral securing the Notes.

Cautionary Statement Regarding Forward-Looking ESG Statements

Certain statements contained in this supplement to the Offering Memorandum, including, without limitation, statements regarding Dunmore's Net-Zero Commitment, expected emissions reductions, planned ESG-related investments, anticipated regulatory developments, and the expected impact of climate-related risks on Dunmore's business and financial condition, are forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. Forward-looking statements can generally be identified by the use of words such as "anticipates," "believes," "commits," "could," "estimates," "expects," "forecasts," "intends," "may," "plans," "projects," "seeks," "should," "targets," "will," "would," or similar expressions, or the negative of such expressions, although not all forward-looking statements contain such words.

These forward-looking statements are based on Dunmore's current expectations, assumptions, estimates, and projections regarding future events and conditions, including, without limitation, the following key assumptions and uncertainties:

• prevailing and future commodity price levels for crude oil, natural gas, and refined products;

• the timing, scope, and stringency of regulatory changes in the United States, Nigeria, Senegal, the European Union, the United Kingdom, the Cayman Islands, and other jurisdictions;

• the technological feasibility, commercial availability, and cost of decarbonization technologies, including carbon capture, utilization, and storage, hydrogen production, and renewable energy generation;

• the availability, cost, and credibility of carbon offsets and carbon credits;

• macroeconomic conditions, including global economic growth, inflation, interest rates, and currency exchange rates;

• political stability and regulatory certainty in Dunmore's principal operating jurisdictions, including Nigeria and Senegal;

• conditions in the insurance and reinsurance markets for climate-related risks;

• the outcome of pending or threatened litigation, arbitration, regulatory proceedings, or investigations;

• the ability of Dunmore to attract and retain qualified personnel; and

• the pace and trajectory of the global energy transition and shifts in consumer, investor, and societal attitudes toward fossil fuels.

These forward-looking statements are subject to significant risks, uncertainties, and contingencies, many of which are beyond Dunmore's control, that could cause actual results to differ materially from those expressed or implied in such statements. Forward-looking statements speak only as of the date on which they are made, and Dunmore undertakes no obligation to update, revise, or supplement any forward-looking statement, whether as a result of new information, future events, changed circumstances, or otherwise, except as may be required by applicable law or regulation.

Investors are referred to the section of the Offering Memorandum captioned "Cautionary Statement Regarding Forward-Looking Statements" for additional cautionary language regarding forward-looking statements generally, which is incorporated by reference into this supplement as if fully set forth herein.

Dunmore's ESG data, including the GHG emissions data, methane flaring intensity data, and community development expenditure data referenced in these risk factors, has been prepared by Barrisford Advisory Group LLC, a third-party ESG advisory firm, and has not been independently audited or assured by Alverton & Co. LLP (Dunmore's independent auditor; Graham Stillwell, lead engagement partner) or by any other independent assurance provider. ESG data measurement methodologies are evolving, and there are currently no universally accepted standards for measuring and reporting all categories of ESG data. As methodologies are refined and industry practices develop, Dunmore may revise or restate historical ESG data, which could result in changes to previously reported metrics and affect comparability across reporting periods. Investors should exercise caution in relying on ESG data and should not place undue reliance on forward-looking ESG statements or on the current ESG data presented in the Offering Memorandum.

DRAFTING NOTES AND INTERNAL COMMENTARY — NOT FOR INCLUSION IN FINAL OFFERING MEMORANDUM

1. Partner Review. This draft is subject to review and comment by Jennifer Kwon (responsible partner, Capital Markets). Please circulate to Jennifer following completion of the first-round associate review. This draft should be coordinated with the companion greenwashing liability analysis memorandum and the net-zero commitment disclosure review memorandum, each prepared by Calderwood & Harkness LLP.

2. ESG Data Verification. Cross-reference to the ESG Data Verification Checklist (C&H internal document), confirming the following data points sourced from Barrisford Advisory Group LLC (Nathan Reyes Linley CPAs LLP, lead consultant):

• Scope 1 GHG emissions: 1.42 million metric tons CO₂e (FY 2024)

• Scope 2 GHG emissions: 0.18 million metric tons CO₂e (FY 2024)

• Community development spend (Nigeria): $14.2 million (FY 2024)

• Methane flaring intensity: 3.8 m³/boe (FY 2024)

3. Framework Coordination. This supplement should be read in conjunction with the ESG Disclosure Framework Memorandum (C&H internal analysis) analyzing SASB, TCFD, and ISSB standards applicable to a high-yield oil and gas offering. The framework memorandum addresses the alignment (and gaps) between Dunmore's current ESG reporting and the requirements of each framework.

4. Safe Harbor Limitations. Note that the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995 are not available for forward-looking statements made in connection with a securities offering (including an offering under Rule 144A and Regulation S). However, the inclusion of cautionary language regarding forward-looking ESG statements is consistent with anti-fraud best practices and may provide evidentiary support for a "bespeaks caution" defense. See the net-zero commitment disclosure review memorandum (C&H internal analysis) for further discussion.

5. Management Confirmation. Please confirm with Alistair Forde (Dunmore General Counsel) that all ESG-related risk factors have been reviewed by management and are consistent with Dunmore's internal records, board minutes, public statements, sustainability reports, and press releases. Any inconsistencies should be flagged for resolution prior to finalization.

6. Layout Instruction. In the final Offering Memorandum layout, this section should be typeset to immediately follow the sanctions, OFAC, and anti-corruption risk factors supplement, within the "Risk Factors" section of the Offering Memorandum.

End of ESG and Climate Risk Factors Supplement

Emissions Category	FY 2024 (million metric tons CO₂e)
Scope 1 (direct emissions)	1.42
Scope 2 (indirect emissions from purchased energy)	0.18
Total Scope 1 and Scope 2	1.60

RISK FACTORS — ENVIRONMENTAL, SOCIAL AND GOVERNANCE AND CLIMATE-RELATED RISKS
Draft Supplement to the Offering Memorandum dated May 14, 2025
$850,000,000 Aggregate Principal Amount 9.375% Senior Secured Notes due 2032
Dunmore Energy Holdings Ltd. (a Cayman Islands exempted company)
and
Dunmore upstream Finance Corp. (a Delaware corporation, as Co-Issuer)
Prepared by Calderwood & Harkness LLP, 425 Lexington Avenue, New York, NY 10017. Matter No. 1016-00003. Drafted by Claire Dempsey (working associate) under the supervision of Jennifer Kwon (responsible partner, Capital Markets). ESG data sourced from Barrisford Advisory Group LLC (Nathan Reyes Linley CPAs LLP, lead consultant), 1700 K Street NW, Suite 900, Washington, DC 20006. This section is intended to be inserted in the "Risk Factors" section of the Final Offering Memorandum (Rule 144A / Regulation S) alongside the companion sanctions/OFAC risk factors supplement. In the final OM layout, this section should be typeset to follow the sanctions, OFAC, and anti-corruption risk factors.
DRAFT — FOR DISCUSSION PURPOSES ONLY — SUBJECT TO REVISION
Introductory Note
The following risk factors address environmental, social and governance ("ESG") matters, climate-related risks, and related regulatory developments that may affect Dunmore Energy Holdings Ltd., together with its subsidiaries (collectively, "Dunmore," the "Company," "we," "us," or "our"), and, consequently, the 9.375% Senior Secured Notes due 2032 (the "Notes") and the related guarantees (the "Guarantees"). These risk factors supplement, and should be read together with, all other risk factors set forth in the Offering Memorandum dated May 14, 2025 (the "Offering Memorandum"), including, without limitation, those risk factors addressing sanctions, Office of Foreign Assets Control ("OFAC"), and anti-corruption risks contained in the companion supplement thereto.
For further detail on Dunmore's ESG programs, metrics, and initiatives, investors should refer to the section of the Offering Memorandum captioned "Environmental and Social Responsibility," which provides additional information regarding Dunmore's environmental compliance framework, community engagement initiatives, governance structures, and sustainability-related targets and metrics.
These risk factors contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). All statements other than statements of historical fact contained in these risk factors, including, without limitation, statements regarding Dunmore's ESG strategy, net-zero commitment, planned investments, anticipated regulatory developments, and expected operational impacts of climate change, are forward-looking statements. Investors are directed to the section of the Offering Memorandum captioned "Cautionary Statement Regarding Forward-Looking Statements" for additional information regarding the identification of forward-looking statements and the risks and uncertainties inherent therein. In addition, the section captioned "Cautionary Statement Regarding Forward-Looking ESG Statements" set forth below contains cautionary language specific to forward-looking ESG-related statements included in this supplement.
Investing in the Notes involves significant risk. Prospective investors should carefully consider all of the risk factors described in the Offering Memorandum, including those set forth below, before making an investment decision with respect to the Notes. If any of the following risks materialize, Dunmore's business, financial condition, results of operations, and prospects could be materially and adversely affected, and the trading price of the Notes could decline, resulting in a loss of all or part of an investor's investment.
Risk Factor 1: Climate-Transition Risk — Regulatory and Policy Changes May Adversely Affect Dunmore's Business, Financial Condition, and Results of Operations
Dunmore's core business is the exploration, development, production, and marketing of crude oil and natural gas through upstream and midstream operations. Dunmore's principal producing interests include Oil Mining Lease 47 ("OML 47") and Oil Mining Lease 63 ("OML 63") in the Niger Delta region of Nigeria, the Cayar Offshore Block in Senegal, and deepwater leases in the Green Canyon and Garden Banks areas of the Gulf of Mexico (the "GoM"). These hydrocarbon-focused operations represent the substantial majority of Dunmore's consolidated revenue and earnings. For the fiscal year ended December 31, 2024 ("FY 2024"), Dunmore reported revenue of approximately $2,140,000,000 and Adjusted EBITDA of approximately $816,000,000, virtually all of which was derived from hydrocarbon production and sales, including associated midstream gathering and processing activities.
Governments and intergovernmental organizations worldwide have adopted, and continue to develop, a broad range of initiatives and regulatory programs intended to reduce greenhouse gas ("GHG") emissions and mitigate the effects of climate change. The Paris Agreement, adopted in December 2015 under the United Nations Framework Convention on Climate Change, establishes a global framework for limiting average temperature increases to well below 2°C above pre-industrial levels, with efforts to limit the increase to 1.5°C. National and sub-national governments have implemented, or are in the process of implementing, range measures to achieve the objectives of the Paris Agreement and related climate goals, including carbon-pricing mechanisms (such as carbon taxes and cap-and-trade programs), emissions trading schemes, methane-reduction regulations, flaring restrictions, fuel efficiency and clean energy standards, and mandates for disclosure of climate-related risks and emissions. These initiatives, individually or in the aggregate, may impose significant additional costs on Dunmore's operations, restrict Dunmore's ability to conduct its business as currently planned, reduce the demand for Dunmore's products, or otherwise have a material adverse effect on Dunmore's business, financial condition, and results of operations.
United States Regulatory Developments. Dunmore's GoM operations, which are conducted through its subsidiaries Dunmore Gulf Operations LLC and Dunmore Midstream Holdings Inc., are subject to a comprehensive regulatory framework administered by federal and state authorities. The U.S. Securities and Exchange Commission (the "SEC") has proposed, and may adopt in final form, rules requiring registrants to disclose extensive information regarding GHG emissions, climate-related financial risks, governance of climate-related risks, and transition plans. While the ultimate scope and timing of such rules remain uncertain, compliance with any final SEC climate disclosure requirements could impose significant additional costs on Dunmore and its subsidiaries, require changes to internal data collection and reporting systems, and expose Dunmore to increased litigation risk in the event that disclosures are deemed to be inaccurate or incomplete. In addition, the U.S. Environmental Protection Agency (the "EPA") has adopted methane emission standards applicable to oil and gas operations, including those in the GoM, which may require Dunmore to install additional emissions-monitoring and emissions-reduction equipment, modify operational practices, and incur ongoing monitoring and compliance costs. The Bureau of Ocean Energy Management ("BOEM") and the Bureau of Safety and Environmental Enforcement ("BSEE") continue to develop and refine regulations applicable to deepwater operations, including requirements related to environmental protection, well integrity, and decommissioning that may be influenced by climate-related policy considerations. Changes in U.S. federal administration and policy priorities could result in either more or less stringent environmental regulation, creating uncertainty for long-term planning and investment decisions.
Nigerian Regulatory Developments. Dunmore's operations in Nigeria, which are conducted through its subsidiary Dunmore Nigeria E&P Ltd., are subject to the Nigerian Petroleum Industry Act (the "PIA"), enacted in August 2021, and related regulations. The PIA contains provisions addressing environmental remediation, gas flaring penalties, and host community development obligations that impose significant compliance burdens on oil and gas operators in Nigeria. Gas flaring penalties under the PIA are structured to escalate over time and are designed to incentivize the reduction and elimination of routine gas flaring. Dunmore's operations at OML 47 and OML 63 remain subject to flaring in certain circumstances due to infrastructure constraints, and escalating penalties could materially increase operating costs. The PIA also requires operators to establish host community development trusts funded by a percentage of operating expenditures, which represents an additional cost. The Department of Petroleum Resources ("DPR"), the Calderon Group ("NNPC"), and successor regulatory authorities continue to develop implementing regulations and guidance under the PIA, and the scope and pace of these regulatory developments remain uncertain. Additional environmental legislation or regulation in Nigeria, whether at the federal or state level, could impose further obligations on Dunmore's Nigerian operations, including requirements for environmental impact assessments, biodiversity offsets, emissions monitoring, or water management.
Senegalese Regulatory Developments. Dunmore's operations in Senegal, conducted through its subsidiary Dunmore Senegal S.A., are governed by the production sharing contract (the "Cayar PSC") for the Cayar Offshore Block and are subject to environmental permit conditions imposed by the Senegalese Ministère de l'Énergie and related governmental authorities. Changes in Senegalese environmental legislation could trigger renegotiation or modification of the terms of the Cayar PSC, potentially resulting in more onerous environmental obligations, increased royalty or tax burdens, or requirements for additional environmental mitigation measures. Senegal is in the early stages of developing its regulatory framework for offshore oil and gas operations, and there is significant uncertainty regarding the future direction and stringency of environmental regulation in this jurisdiction. Any material changes to the regulatory framework could adversely affect the economics of the Cayar Offshore Block, including the planned Phase II development, to which approximately $250,000,000 of the net proceeds of the Notes are expected to be allocated.
EU and UK Regulatory Developments. Dunmore Trading Ltd., a private limited company incorporated in England and Wales and Dunmore's offtake and trading arm, may be affected by European Union and United Kingdom climate and environmental regulations. The EU Carbon Border Adjustment Mechanism ("CBAM"), which imposes costs on the embedded carbon content of certain imported goods, and the UK Emissions Trading Scheme ("UK ETS"), which caps GHG emissions from certain sectors and requires participants to hold emissions allowances, could increase the costs associated with Dunmore Trading Ltd.'s commercial activities or reduce the competitiveness of Dunmore's products in European markets. To the extent that EU or UK regulations impose additional reporting, compliance, or financial obligations on Dunmore Trading Ltd. or affect market pricing for Dunmore's crude oil and natural gas, such regulations could have an adverse effect on Dunmore's consolidated results of operations.
Carbon Taxes and Emissions Caps. The imposition of carbon taxes, emissions caps, or other carbon-pricing mechanisms in jurisdictions in which Dunmore operates or sells its products could increase Dunmore's operating costs, reduce demand for fossil fuels, or both. Even in the absence of binding regulations in Dunmore's principal operating jurisdictions, the adoption of carbon-pricing mechanisms in major consuming markets could depress global commodity prices by reducing overall demand for crude oil and natural gas, thereby adversely affecting Dunmore's revenue and profitability.
Transition Away from Fossil Fuels. The broader energy transition — characterized by a global shift away from fossil fuels and toward renewable energy sources, electrification, energy efficiency, and other low-carbon alternatives — could result in a structural decline in global demand for crude oil and natural gas over the medium to long term. Such a decline could depress commodity prices and adversely affect Dunmore's revenue, proved reserves valuations, and ability to service the Notes. As of December 31, 2024, Dunmore's total proved reserves were 345.8 million barrels of oil equivalent ("MMboe"), with a standardized measure of discounted future net cash flows (PV-10) of approximately $6,700,000,000, as reported by Dunmore's independent petroleum engineering consultants, Duval Howard & Partners. A sustained decline in commodity prices resulting from the energy transition could materially reduce the value of these proved reserves and the associated PV-10, potentially resulting in impairment charges and adversely affecting the value of the Collateral securing the Notes.
Stranded Asset Risk. If the energy transition accelerates faster than currently anticipated — due to technological breakthroughs, more aggressive regulatory action, shifts in consumer behavior, or other factors — certain of Dunmore's hydrocarbon assets could become uneconomic to develop or produce before the end of their expected productive lives, a scenario commonly referred to as "stranded assets." Such a development could result in write-downs, impairments, or abandonment of assets, which would adversely affect Dunmore's financial condition and the value of the Collateral securing the Notes.
Renewable Energy Portfolio. Dunmore's nascent renewable energy portfolio, consisting of a 220-megawatt ("MW") solar portfolio in West Texas held by Dunmore Renewables LLC, represents a small fraction of Dunmore's overall asset base and revenue. There can be no assurance that Dunmore will be able to grow its renewable energy portfolio at a pace sufficient to offset potential declines in hydrocarbon revenue resulting from the energy transition, regulatory changes, or shifts in market demand. The development and scaling of renewable energy operations involve significant capital requirements, technological risks, permitting challenges, and market uncertainties that may limit the pace and extent of diversification.
Risk Factor 2: Climate-Transition Risk — Dunmore's Net-Zero by 2050 Commitment May Not Be Achieved, and Failure to Meet or Perceived Failure to Meet Such Commitment Could Have Adverse Consequences
Dunmore has publicly committed to achieving net-zero GHG emissions across its operations by 2050 (the "Net-Zero Commitment"). The Net-Zero Commitment is aspirational and forward-looking in nature, and its achievement is dependent upon numerous factors, many of which are beyond Dunmore's control, including, without limitation, the pace and direction of technological developments (including carbon capture, utilization, and storage ("CCUS") technologies), the availability and cost of carbon offsets and carbon credits, the evolution of regulatory frameworks in the jurisdictions in which Dunmore operates, prevailing commodity prices and market conditions, and the broader trajectory of the global energy transition.
As of FY 2024, Dunmore's GHG emissions profile is as follows, based on data prepared by Barrisford Advisory Group LLC:
Dunmore's methane flaring intensity was 3.8 cubic meters per barrel of oil equivalent ("m³/boe") for FY 2024, compared to an industry average of approximately 5.1 m³/boe. While Dunmore's flaring intensity is below the industry average, gas flaring remains a significant source of GHG emissions and is subject to increasing regulatory scrutiny, particularly in Nigeria under the PIA. Dunmore has not publicly disclosed Scope 3 GHG emissions (emissions occurring in the value chain, including end-use combustion of Dunmore's products by customers), which are expected to be substantially larger than Scope 1 and Scope 2 emissions combined. The absence of comprehensive Scope 3 data may limit stakeholders' ability to assess the full climate impact of Dunmore's operations and the feasibility of the Net-Zero Commitment.
There can be no assurance that Dunmore will achieve the intermediate milestones necessary to remain on a trajectory consistent with the Net-Zero Commitment, or that the 2050 target itself will be met. The pathway to net-zero for an upstream and midstream oil and gas company is inherently uncertain, and the technological, regulatory, and market conditions required to achieve such a target may not materialize on the timeline or at the scale assumed.
Failure to achieve, or to demonstrate meaningful progress toward, the Net-Zero Commitment could have a number of adverse consequences, including, without limitation:
(i) Reputational Harm. Perceived failure to meet climate commitments could damage Dunmore's reputation among investors, lenders, employees, regulators, host communities, and the general public, particularly as stakeholder expectations regarding corporate climate action continue to intensify.
(ii) Increased Cost of Capital. A growing number of institutional investors and financial institutions have adopted ESG-related investment criteria, exclusion lists, or engagement policies that target companies perceived to be lagging in their climate performance. Failure to demonstrate credible progress on the Net-Zero Commitment could increase Dunmore's cost of capital, reduce investor demand for the Notes, and limit Dunmore's access to financing markets.
(iii) Negative Ratings Actions. Credit rating agencies, including those that have provided preliminary ratings for the Notes (Lodestar Ratings International: B2 / Stable; Veridian Credit Assessments Inc.: B+ / Stable), are increasingly incorporating ESG factors into their ratings methodologies. A failure to meet the Net-Zero Commitment, or the perception of such failure, could contribute to negative ratings actions, which would increase Dunmore's borrowing costs and could trigger adverse consequences under the terms of the Indenture governing the Notes or the existing credit facilities.
(iv) Litigation Risk. The failure or perceived failure to meet publicly stated climate commitments could expose Dunmore to litigation, including claims alleging misleading or deceptive statements regarding climate performance, greenwashing, or breach of fiduciary duty.
Investor expectations regarding ESG performance and climate commitments are evolving rapidly and may exceed Dunmore's ability to deliver. Standards and frameworks for evaluating corporate climate performance are not yet uniform, and different stakeholders may apply different metrics, benchmarks, and expectations, making it difficult for Dunmore to satisfy all constituencies simultaneously. Moreover, certain investors and advocacy organizations have adopted increasingly prescriptive positions regarding the pace and scope of decarbonization, including calls for oil and gas companies to curtail hydrocarbon production on timelines that may be inconsistent with Dunmore's business plan, contractual obligations, and the interests of holders of the Notes.
The costs of implementing decarbonization strategies — including investments in emissions-reduction technologies, carbon capture, operational efficiency improvements, methane abatement, and the development of renewable energy assets — could be material and may divert capital from Dunmore's core hydrocarbon development activities. In particular, approximately $250,000,000 of the net proceeds of the Notes are expected to be allocated to the Cayar Offshore Phase II development, a significant hydrocarbon investment that may be viewed as inconsistent with the Net-Zero Commitment by certain stakeholders. There is an inherent tension between the capital requirements of Dunmore's hydrocarbon development program and the investments necessary to pursue decarbonization, and there can be no assurance that Dunmore will be able to balance these competing priorities in a manner that satisfies all stakeholders or achieves the Net-Zero Commitment.
Risk Factor 3: Physical Climate Risk — Dunmore's Operations Are Exposed to Physical Risks from Climate Change
Dunmore's assets and operations span multiple geographies with distinct physical climate exposures. The physical effects of climate change — including rising temperatures, sea-level rise, increased frequency and severity of extreme weather events, changes in precipitation patterns, and other meteorological and environmental phenomena — could adversely affect Dunmore's operations, infrastructure, financial condition, and results of operations.
Gulf of Mexico. Dunmore's deepwater operations in the Green Canyon and Garden Banks areas of the GoM, conducted through Dunmore Gulf Operations LLC and Dunmore Midstream Holdings Inc., are exposed to hurricanes and tropical storms, the frequency and severity of which scientific evidence suggests may increase as a result of climate change. Hurricanes and tropical storms can cause extended production shut-ins, physical damage to offshore platforms, subsea wellheads, pipelines, processing facilities, and floating production systems, as well as disruptions to transportation and logistics. The GoM region has historically experienced significant hurricane-related production outages and infrastructure damage, and future events could be more severe or frequent than historical patterns would suggest. The costs of repairing or replacing damaged infrastructure, the revenue lost during production interruptions, and the potential for environmental remediation obligations arising from storm-related releases could be substantial.
Niger Delta, Nigeria. Dunmore's operations at OML 47 and OML 63 in the Niger Delta region of Nigeria, operated by Dunmore Nigeria E&P Ltd., are located in a low-lying coastal environment that is vulnerable to a range of physical climate impacts, including coastal flooding, sea-level rise, saltwater intrusion, and extreme precipitation events. These phenomena could adversely affect onshore and shallow-water production infrastructure, flow stations, gathering pipelines, and export terminals, resulting in production disruptions, infrastructure damage, and environmental contamination requiring remediation. The Niger Delta region is already subject to significant environmental challenges, and climate-related exacerbation of flooding and erosion could compound existing risks and increase the frequency and severity of operational disruptions.
Cayar Offshore Block, Senegal. Dunmore's operations at the Cayar Offshore Block in Senegal, operated by Dunmore Senegal S.A., include coastal staging areas, logistics bases, and marine infrastructure that are exposed to sea-level rise, storm surge, and coastal erosion. While the offshore production facilities themselves are designed to withstand marine environmental conditions, the onshore logistics and support infrastructure that is critical to the operation of the Cayar Offshore Block may be vulnerable to climate-related impacts. Any damage to or disruption of coastal staging and logistics infrastructure could delay development activities, interrupt production, and increase costs.
West Texas Solar Portfolio. Dunmore's 220 MW solar portfolio in West Texas, held by Dunmore Renewables LLC, is exposed to physical climate risks distinct from those affecting Dunmore's hydrocarbon operations. Extreme heat events can reduce the efficiency and output of solar photovoltaic panels, while hailstorms can cause physical damage to solar panels and associated electrical infrastructure. Wildfire risk in West Texas, which may be exacerbated by climate change, could threaten solar facilities, access roads, and transmission interconnections. While the solar portfolio represents a relatively small portion of Dunmore's overall asset base, physical damage or production losses at these facilities could impair the value of these assets and adversely affect Dunmore's diversification strategy.
Insurance and Financial Impacts. Physical damage to Dunmore's assets resulting from climate-related events could give rise to production interruptions, environmental remediation obligations, increased insurance premiums, deductibles, and exclusions, and capital expenditure requirements for repairs, replacements, and resilience improvements. Insurance coverage for climate-related events may become more expensive, subject to higher deductibles, or less available as insurers reassess their exposure to climate-related risks. The assignment of insurance proceeds forms part of the collateral package securing the Notes; any reduction in the scope, availability, or adequacy of insurance coverage could adversely affect the value of the Collateral and the recovery available to holders of the Notes in the event of a default.
Supply Chain Disruptions. Climate-related disruptions to Dunmore's supply chain — including the availability of drilling rigs, completion equipment, maintenance services, transportation and logistics, and qualified personnel — could delay development activities, increase costs, and reduce production. Such disruptions may arise from extreme weather events affecting ports, shipyards, manufacturing facilities, or transportation routes, or from broader market dislocations resulting from the cumulative impact of climate-related events across the oil and gas industry.
Capital Expenditure Implications. For FY 2024, Dunmore's consolidated capital expenditures were approximately $387,000,000. Dunmore may need to increase capital expenditures in future periods to address climate adaptation and resilience measures, including hardening of physical infrastructure, relocation of vulnerable assets, installation of flood protection systems, and upgrades to emergency response capabilities. Such additional capital expenditures, to the extent they are required, could reduce the capital available for hydrocarbon development, renewable energy investment, debt service, and other corporate purposes, and could adversely affect Dunmore's financial condition and its ability to comply with covenants under the Indenture governing the Notes.
Risk Factor 4: Evolving ESG Regulatory and Disclosure Landscape — New or Changing Requirements Could Increase Compliance Costs and Litigation Risk
The regulatory landscape for ESG disclosure and reporting is rapidly evolving across all jurisdictions in which Dunmore operates, and the pace and direction of regulatory developments remain highly uncertain. Dunmore is subject to, or may in the future become subject to, range ESG-related disclosure and reporting requirements imposed by governmental authorities, securities regulators, stock exchanges, and other standard-setting bodies.
SEC Climate Disclosure Rules. The SEC has proposed, and may adopt in final form, rules that would require public companies and issuers to provide enhanced disclosure of GHG emissions (including Scope 1, Scope 2, and potentially Scope 3 emissions), climate-related financial risks and their impact on business strategy and financial planning, governance of climate-related risks, and climate transition plans. While the final scope and effective date of any such rules remain uncertain, compliance could impose substantial costs on Dunmore, including costs associated with the development and implementation of emissions measurement and data management systems, internal controls over ESG data, third-party verification and assurance, and the preparation and filing of additional disclosures. Even in the absence of final SEC rules, Dunmore may face pressure from investors, rating agencies, and market participants to provide climate-related disclosures consistent with emerging standards and frameworks.
International Frameworks. Several international frameworks and standard-setting bodies have developed or are developing ESG-related disclosure standards that are relevant to Dunmore and its investors. These include the Task Force on Climate-related Financial Disclosures ("TCFD"), the International Sustainability Standards Board ("ISSB") of the IFRS Foundation (which has issued IFRS S1 and IFRS S2, addressing general sustainability-related and climate-related disclosure requirements, respectively), and the Sustainability Accounting Standards Board ("SASB"). While these frameworks are converging in certain respects, they are not yet fully harmonized, and Dunmore may face overlapping, duplicative, and potentially inconsistent disclosure requirements across different frameworks and jurisdictions. The cost and complexity of preparing disclosures that satisfy multiple frameworks could be significant.
EU and UK Regulatory Developments. The EU Corporate Sustainability Reporting Directive ("CSRD") and the EU Taxonomy Regulation impose detailed sustainability reporting and classification requirements on companies with activities in the European Union. While Dunmore is not directly subject to the CSRD, Dunmore Trading Ltd.'s operations in England and Wales, and European investor expectations regarding ESG disclosure, may create indirect pressure on Dunmore to align its reporting with EU standards. Similarly, the UK government has announced plans to implement sustainability disclosure requirements consistent with the ISSB standards, which could affect Dunmore Trading Ltd. and influence investor expectations regarding Dunmore's consolidated ESG reporting.
Other Jurisdictions. Regulatory authorities in Nigeria, Senegal, and the Cayman Islands may adopt their own ESG reporting and disclosure requirements. While such requirements are currently less developed than those in the United States, the EU, and the UK, the trend toward mandatory ESG disclosure is global, and Dunmore could face additional compliance obligations in these jurisdictions in the future.
Compliance Costs and Data Infrastructure. Compliance with new or expanded ESG disclosure requirements could require significant investment in data collection and management systems, internal controls and processes, employee training, and third-party assurance services. Currently, Dunmore's ESG data is prepared by Barrisford Advisory Group LLC, a third-party ESG advisory firm, but is not independently audited or subject to third-party assurance. Future regulatory requirements may mandate independent assurance of ESG data, which would increase compliance costs and could reveal data quality or methodological issues that require remediation. There can be no assurance that Dunmore's current data infrastructure and reporting capabilities will be sufficient to meet future regulatory requirements.
Enforcement Actions and Litigation Risk. Failure to comply with evolving ESG disclosure requirements could result in enforcement actions by securities regulators, including the SEC, the UK Financial Conduct Authority, and other regulatory authorities, as well as fines, penalties, and other sanctions. In addition, Dunmore could face private litigation, including securities fraud claims, alleging that its ESG-related disclosures are inaccurate, incomplete, or misleading. The Offering Memorandum's ESG-related disclosures, including the section captioned "Environmental and Social Responsibility" and these risk factors, have been prepared based on data as of FY 2024 using methodologies and assumptions that Dunmore believes to be reasonable. However, there is no assurance that Dunmore's current ESG data collection and reporting methodology will satisfy future regulatory requirements, and any revision or restatement of ESG data could create disclosure challenges and increase litigation risk.
Risk Factor 5: Reputational Risk — Negative ESG Perceptions Could Impair Access to Capital and Business Relationships
There is a growing focus by investors, lenders, regulators, credit rating agencies, proxy advisory firms, ESG rating providers, and other stakeholders on the ESG performance of companies in the oil and gas sector. This increased scrutiny reflects broader societal concerns regarding climate change, environmental protection, social responsibility, and corporate governance, and has given rise to a range of initiatives, policies, and market practices that may adversely affect Dunmore.
Dunmore's majority owner, Harborview Capital Partners Fund VI, L.P. (holding approximately 62.4% of Dunmore's equity), and its co-investors, including Solstice Infrastructure Fund LP (approximately 11.1%) and Alderman Family Office LLC (approximately 8.2%), may themselves face pressure from their own limited partners, investors, and stakeholders regarding the ESG performance of their portfolio companies, including Dunmore. Such pressure could influence the investment strategies, capital allocation decisions, and exit plans of Dunmore's equity sponsors, potentially in ways that are adverse to the interests of holders of the Notes.
Negative media coverage, activist campaigns, adverse ESG ratings or scores, inclusion on divestment or exclusion lists, or other negative ESG-related perceptions could have a number of adverse effects on Dunmore, including, without limitation:
(i) Secondary Market for the Notes. Negative ESG perceptions could reduce demand for the Notes in the secondary market, impairing liquidity and potentially reducing the trading price of the Notes.
(ii) Refinancing Risk. Negative ESG perceptions could increase the cost or reduce the availability of refinancing for the Notes upon maturity or for Dunmore's existing $750,000,000 asset-based lending facility with Velthorn National Bank, N.A. (of which approximately $470,000,000 was drawn as of the date hereof). Financial institutions are increasingly incorporating ESG criteria into their lending and underwriting decisions, and Dunmore's ability to access credit markets on favorable terms may be impaired by adverse ESG perceptions.
(iii) Employee Attraction and Retention. Negative ESG perceptions could impair Dunmore's ability to attract and retain qualified employees, including technical, operational, and managerial personnel. As of FY 2024, Dunmore employed approximately 3,400 people worldwide, many of whom possess specialized skills critical to Dunmore's operations. Competition for talent in the oil and gas industry is intense, and ESG considerations are an increasingly important factor in employment decisions, particularly among younger workers.
(iv) Business Relationships. Negative ESG perceptions could adversely affect Dunmore's relationships with joint venture partners, host governments, regulatory authorities, suppliers, contractors, and communities, potentially resulting in the loss of business opportunities, unfavorable contract terms, or increased regulatory scrutiny.
Community Relations. Dunmore's community development expenditures in Nigeria totaled approximately $14.2 million in FY 2024, including contributions to host community development trusts, infrastructure projects, educational initiatives, and other community programs. While Dunmore believes these expenditures are consistent with its obligations under the PIA and its contractual commitments, there can be no assurance that host communities, non-governmental organizations ("NGOs"), regulatory authorities, or other stakeholders will view Dunmore's community development spend as adequate. Perceptions of insufficient community engagement or investment could lead to operational disruptions, protests, blockades, community-relations disputes, or other actions that could interrupt production, delay development activities, and adversely affect Dunmore's reputation and results of operations, particularly in the Niger Delta, where community-relations issues have historically been a significant source of operational risk for oil and gas operators.
Environmental Incidents. Environmental incidents, including oil spills, gas releases, well blowouts, pipeline leaks, and other accidental discharges, at any of Dunmore's operations could attract significant negative public, media, and regulatory attention and result in enforcement actions, penalties, remediation costs, and litigation, the financial impact of which could be disproportionate to the direct costs of the incident itself. The reputational harm from a significant environmental incident could persist long after the incident has been remediated and could adversely affect Dunmore's relationships with regulators, communities, investors, and other stakeholders.
Risk Factor 6: Environmental Remediation and Decommissioning Liabilities May Be Significant
Dunmore's operations are subject to extensive environmental laws and regulations in each jurisdiction in which it operates, which impose obligations with respect to the prevention and remediation of environmental contamination, the management and disposal of hazardous substances and waste, the protection of air and water quality, and the decommissioning and restoration of production facilities and producing areas at the end of their economic life.
Nigeria. Nigerian law and the provisions of the PIA require operators to undertake progressive abandonment and decommissioning planning for oil mining leases and associated production facilities. Dunmore Nigeria E&P Ltd. is required to maintain decommissioning plans and to make periodic financial provisions for the eventual abandonment and decommissioning of facilities associated with OML 47 and OML 63. The Niger Delta region has a long history of environmental contamination associated with oil and gas operations, including legacy contamination from historical spills and operational discharges, and Dunmore may be required to undertake remediation of contaminated sites, whether or not such contamination resulted from Dunmore's own activities. The scope and cost of remediation and decommissioning obligations in Nigeria are subject to significant uncertainty, including uncertainty regarding the evolution of legal requirements, the identification of previously unknown contamination, and the standards of remediation that may be required by regulatory authorities.
Senegal. The Cayar PSC includes decommissioning obligations that require Dunmore Senegal S.A. to decommission and remove offshore production facilities and to restore the seabed at the conclusion of production activities. The costs of offshore decommissioning in deepwater environments can be substantial and are subject to significant variability depending on the nature and scale of the facilities, the water depth, prevailing market conditions for decommissioning services, and applicable regulatory requirements. As the Cayar Offshore Block is in a relatively early stage of development, the full scope of decommissioning obligations is not yet determinable, but such obligations could be material.
Gulf of Mexico. BOEM regulations require operators of offshore oil and gas leases in the GoM to post decommissioning bonds or provide other forms of financial assurance to guarantee the performance of decommissioning obligations. The bonding and financial assurance requirements applicable to GoM leases have been subject to periodic review and revision by BOEM, and any increase in bonding requirements could impose additional costs on Dunmore Gulf Operations LLC or require the allocation of additional Collateral or other financial resources to satisfy such requirements.
Changes in Law and Scope of Liabilities. Estimated decommissioning and environmental remediation liabilities may increase as a result of changes in applicable law, new discoveries of previously unknown contamination, increases in the scope of required remediation, changes in remediation standards or technologies, and increases in the costs of labor, materials, and services required for remediation and decommissioning activities. Environmental laws and regulations have historically tended to become more stringent over time, and Dunmore should expect that its environmental compliance obligations will increase in scope and cost in the future.
Any material increase in environmental remediation or decommissioning liabilities could reduce the value of the Collateral securing the Notes, increase Dunmore's cash outflows, reduce the funds available for debt service, and adversely affect Dunmore's ability to comply with the financial and other covenants contained in the Indenture governing the Notes. To the extent that decommissioning or remediation obligations constitute priority claims or liens on Dunmore's assets under applicable law, such claims could reduce recoveries available to holders of the Notes in the event of a default.
Risk Factor 7: ESG-Related Litigation Risk
Companies in the oil and gas sector face a growing volume and expanding scope of litigation related to climate change and ESG matters. Climate-related litigation includes, without limitation, claims seeking damages for alleged contribution to global warming and its effects (including property damage, personal injury, and economic loss), challenges to environmental permits and governmental approvals for oil and gas projects, securities fraud claims based on alleged misstatements or omissions regarding climate risks or ESG metrics, and derivative actions alleging breach of fiduciary duty by directors and officers in connection with the management of climate-related risks.
Dunmore could be subject to litigation in multiple jurisdictions, including the United States (both federal and state courts), Nigeria, Senegal, England and Wales, and the Cayman Islands, alleging, among other things:
•  inadequate disclosure of climate-related risks in the Offering Memorandum, annual reports, or other public communications;
•  misleading ESG-related claims or representations, commonly referred to as "greenwashing," including in connection with the Net-Zero Commitment;
•  failure to take adequate steps to mitigate the climate impacts of Dunmore's operations;
•  contribution to global warming and associated environmental and social harm;
•  breach of environmental laws, regulations, permits, or contractual obligations; or
•  breach of fiduciary duty by Dunmore's directors and officers in connection with the oversight of climate-related risks.
Securities law claims could allege that the Offering Memorandum's ESG-related disclosures, including the section captioned "Environmental and Social Responsibility" and these risk factors, are materially misleading by reason of misstatement, omission, or failure to disclose material information regarding Dunmore's climate-related risks, emissions, or ESG performance. While Dunmore believes that the ESG-related disclosures contained in the Offering Memorandum are accurate and adequate in all material respects, there can be no assurance that claims will not be brought by holders of the Notes, regulatory authorities, or other parties, or that such claims, if brought, will not result in material liability, settlement costs, or other adverse consequences.
The defense of ESG-related litigation can be costly, time-consuming, and disruptive to Dunmore's business operations, regardless of the ultimate outcome. Legal fees, expert costs, discovery expenses, and management time devoted to litigation defense can be substantial. Potential liability from adverse judgments, settlements, or consent decrees could be material and is inherently difficult to predict. ESG-related litigation may also generate negative publicity that compounds the reputational risks described elsewhere in these risk factors. The insurance coverage available to Dunmore for ESG-related litigation may be limited, and there can be no assurance that Dunmore's existing insurance policies will cover all defense costs or potential liability arising from such litigation.
Risk Factor 8: Social and Governance Risks — Human Rights, Community Relations, and Governance Matters Could Affect Operations
Dunmore's operations in Nigeria and Senegal involve extensive engagement with local communities, indigenous populations, and government stakeholders in jurisdictions where human rights, labor, governance, and rule-of-law risks are elevated relative to more developed markets. The social and governance risks associated with operating in these environments are complex and multifaceted and could have a material adverse effect on Dunmore's business, financial condition, results of operations, and reputation.
Human Rights. International frameworks, including the United Nations Guiding Principles on Business and Human Rights and the OECD Guidelines for Multinational Enterprises, establish expectations for companies to respect human rights throughout their operations and supply chains. Dunmore's operations in the Niger Delta and Senegal are conducted in regions where human rights concerns — including issues related to land rights, environmental justice, security practices, labor conditions, and community displacement — have been the subject of significant domestic and international attention. While Dunmore has adopted policies and procedures designed to promote respect for human rights in its operations, there can be no assurance that such policies will be effective in all circumstances or that Dunmore's activities will not give rise to human rights-related claims, complaints, or litigation.
Governance. Dunmore's Board of Directors is chaired by Lady Constance Harrowby, an independent director and former UK Energy Minister, and Dunmore's Chief Executive Officer is Marcus Ellingham. Under their leadership, Dunmore has implemented governance frameworks, policies, and procedures designed to oversee ESG-related risks and to promote ethical business conduct, regulatory compliance, and stakeholder engagement. However, no governance framework can guarantee the prevention or detection of all ESG-related compliance failures, misconduct, or operational incidents. The effectiveness of Dunmore's governance structures depends on the integrity and diligence of individual directors, officers, and employees, and the complexity and geographic dispersion of Dunmore's operations create inherent challenges for governance and oversight.
Supply Chain and Contractor Risks. Dunmore relies on a large number of third-party contractors, service providers, and suppliers to support its exploration, development, production, and midstream operations. The ESG practices, labor standards, human rights records, and environmental compliance of these third parties may not meet Dunmore's own standards or the expectations of Dunmore's investors and other stakeholders. Violations of environmental, labor, human rights, or anti-corruption laws by Dunmore's contractors or suppliers could expose Dunmore to legal liability, regulatory sanctions, and reputational harm, even where Dunmore itself has not engaged in wrongful conduct. Dunmore's ability to monitor and enforce ESG compliance across its supply chain is limited, particularly in jurisdictions with weak regulatory enforcement and limited transparency.
Anti-Bribery and Anti-Corruption. Anti-bribery and anti-corruption considerations, which intersect with broader governance and ESG risks, are addressed in detail in the companion sanctions, OFAC, and anti-corruption risk factors supplement. Investors should review those risk factors in conjunction with the social and governance risks described herein.
Social License to Operate. Dunmore's ability to maintain a social license to operate — that is, the ongoing acceptance and approval of Dunmore's operations by local communities, host governments, and other stakeholders — is essential to the continuity of Dunmore's business. Failure to maintain an adequate social license to operate, whether as a result of environmental incidents, community grievances, human rights concerns, governance failures, or other factors, could result in the revocation or non-renewal of exploration or production licenses, the denial of environmental or operating permits, contractual defaults under production sharing contracts ("PSCs") and joint operating agreements ("JOAs"), community protests and operational disruptions, and other consequences that could materially and adversely affect Dunmore's business and the value of the Collateral securing the Notes.
Cautionary Statement Regarding Forward-Looking ESG Statements
Certain statements contained in this supplement to the Offering Memorandum, including, without limitation, statements regarding Dunmore's Net-Zero Commitment, expected emissions reductions, planned ESG-related investments, anticipated regulatory developments, and the expected impact of climate-related risks on Dunmore's business and financial condition, are forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. Forward-looking statements can generally be identified by the use of words such as "anticipates," "believes," "commits," "could," "estimates," "expects," "forecasts," "intends," "may," "plans," "projects," "seeks," "should," "targets," "will," "would," or similar expressions, or the negative of such expressions, although not all forward-looking statements contain such words.
These forward-looking statements are based on Dunmore's current expectations, assumptions, estimates, and projections regarding future events and conditions, including, without limitation, the following key assumptions and uncertainties:
•  prevailing and future commodity price levels for crude oil, natural gas, and refined products;
•  the timing, scope, and stringency of regulatory changes in the United States, Nigeria, Senegal, the European Union, the United Kingdom, the Cayman Islands, and other jurisdictions;
•  the technological feasibility, commercial availability, and cost of decarbonization technologies, including carbon capture, utilization, and storage, hydrogen production, and renewable energy generation;
•  the availability, cost, and credibility of carbon offsets and carbon credits;
•  macroeconomic conditions, including global economic growth, inflation, interest rates, and currency exchange rates;
•  political stability and regulatory certainty in Dunmore's principal operating jurisdictions, including Nigeria and Senegal;
•  conditions in the insurance and reinsurance markets for climate-related risks;
•  the outcome of pending or threatened litigation, arbitration, regulatory proceedings, or investigations;
•  the ability of Dunmore to attract and retain qualified personnel; and
•  the pace and trajectory of the global energy transition and shifts in consumer, investor, and societal attitudes toward fossil fuels.
These forward-looking statements are subject to significant risks, uncertainties, and contingencies, many of which are beyond Dunmore's control, that could cause actual results to differ materially from those expressed or implied in such statements. Forward-looking statements speak only as of the date on which they are made, and Dunmore undertakes no obligation to update, revise, or supplement any forward-looking statement, whether as a result of new information, future events, changed circumstances, or otherwise, except as may be required by applicable law or regulation.
Investors are referred to the section of the Offering Memorandum captioned "Cautionary Statement Regarding Forward-Looking Statements" for additional cautionary language regarding forward-looking statements generally, which is incorporated by reference into this supplement as if fully set forth herein.
Dunmore's ESG data, including the GHG emissions data, methane flaring intensity data, and community development expenditure data referenced in these risk factors, has been prepared by Barrisford Advisory Group LLC, a third-party ESG advisory firm, and has not been independently audited or assured by Alverton & Co. LLP (Dunmore's independent auditor; Graham Stillwell, lead engagement partner) or by any other independent assurance provider. ESG data measurement methodologies are evolving, and there are currently no universally accepted standards for measuring and reporting all categories of ESG data. As methodologies are refined and industry practices develop, Dunmore may revise or restate historical ESG data, which could result in changes to previously reported metrics and affect comparability across reporting periods. Investors should exercise caution in relying on ESG data and should not place undue reliance on forward-looking ESG statements or on the current ESG data presented in the Offering Memorandum.
DRAFTING NOTES AND INTERNAL COMMENTARY — NOT FOR INCLUSION IN FINAL OFFERING MEMORANDUM
1.  Partner Review. This draft is subject to review and comment by Jennifer Kwon (responsible partner, Capital Markets). Please circulate to Jennifer following completion of the first-round associate review. This draft should be coordinated with the companion greenwashing liability analysis memorandum and the net-zero commitment disclosure review memorandum, each prepared by Calderwood & Harkness LLP.
2.  ESG Data Verification. Cross-reference to the ESG Data Verification Checklist (C&H internal document), confirming the following data points sourced from Barrisford Advisory Group LLC (Nathan Reyes Linley CPAs LLP, lead consultant):
•  Scope 1 GHG emissions: 1.42 million metric tons CO₂e (FY 2024)
•  Scope 2 GHG emissions: 0.18 million metric tons CO₂e (FY 2024)
•  Community development spend (Nigeria): $14.2 million (FY 2024)
•  Methane flaring intensity: 3.8 m³/boe (FY 2024)
3.  Framework Coordination. This supplement should be read in conjunction with the ESG Disclosure Framework Memorandum (C&H internal analysis) analyzing SASB, TCFD, and ISSB standards applicable to a high-yield oil and gas offering. The framework memorandum addresses the alignment (and gaps) between Dunmore's current ESG reporting and the requirements of each framework.
4.  Safe Harbor Limitations. Note that the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995 are not available for forward-looking statements made in connection with a securities offering (including an offering under Rule 144A and Regulation S). However, the inclusion of cautionary language regarding forward-looking ESG statements is consistent with anti-fraud best practices and may provide evidentiary support for a "bespeaks caution" defense. See the net-zero commitment disclosure review memorandum (C&H internal analysis) for further discussion.
5.  Management Confirmation. Please confirm with Alistair Forde (Dunmore General Counsel) that all ESG-related risk factors have been reviewed by management and are consistent with Dunmore's internal records, board minutes, public statements, sustainability reports, and press releases. Any inconsistencies should be flagged for resolution prior to finalization.
6.  Layout Instruction. In the final Offering Memorandum layout, this section should be typeset to immediately follow the sanctions, OFAC, and anti-corruption risk factors supplement, within the "Risk Factors" section of the Offering Memorandum.
End of ESG and Climate Risk Factors Supplement
Emissions Category | FY 2024 (million metric tons CO₂e)
Scope 1 (direct emissions) | 1.42
Scope 2 (indirect emissions from purchased energy) | 0.18
Total Scope 1 and Scope 2 | 1.60

RISK FACTORS — ENVIRONMENTAL, SOCIAL AND GOVERNANCE AND CLIMATE-RELATED RISKS

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