31 October 2007
ELIXIR PETROLEUM LIMITED
("Elixir" or "the Company")
QUARTERLY ACTIVITIES REPORT FOR PERIOD ENDED
30 SEPTEMBER, 2007
* Merger approved by Gawler shareholders and Second Court Hearing
* Enlarged entity's new shares start trading around 13 November
* Panther farmout negotiations at advanced stage
* Encouraging technical results on 24th Round Block 21/16b
* Production commences at Gawler's High Island project
Block 211/18b (EXR 56% interest)
The assignment of a 30% interest in Block 211/18b and the execution
of the Joint Operating Agreement with farminee RWE Dea UK SNS Limited
("RWE") were completed in early August.
Block 211/18b (Licence P1381) is a Traditional licence awarded in the
23rd Seaward Licensing Round in December 2005. The initial interest
holders in P1381 were Elixir (80%) and its joint venture partner,
Sosina Exploration Ltd ("Sosina") (20%). Under the terms of the
farmin, RWE will earn a 30% interest in Block 211/18b by contributing
on a promoted basis to the cost of drilling an exploration well on
the Leopard prospect within the block.
Efforts to secure another farminee in order to largely cover Elixir's
and Sosina's cost exposures in the proposed Leopard well are ongoing
with several companies assessing the opportunity.
The availability of suitable drilling rigs has improved significantly
over recent months with a number of well slots becoming available
during 2008. Provided that the Leopard farmout can be concluded over
the coming months, we remain confident that the well can be drilled
Block 21/16b (EXR 40% interest)
Good progress has been made on Promote Block 21/16b (Licence P1507)
during the quarter towards finalising pre-requisite technical work
prior to farmout. State-of-the-art fluid inclusion studies of a
number of wells already drilled in the area have demonstrated the
movement of hydrocarbons through a well previously classified as a
dry hole and proved a hydrocarbon migration path across the block. An
interesting Jurassic prospect has been identified on this trend
within Block 21/16b and will now form the focus of farmout attention.
Block 211/8b (EXR 80% interest)
Block 211/8b (Licence P1379) is a Promote licence awarded in the 23rd
Licensing Round in December 2005. Under the terms of the Promote
licensing scheme, a drilling commitment or similar substantial work
program is required by the Department of Business, Enterprise and
Regulatory Reform (BERR, formerly known as the DTI) by the second
anniversary of licence award.
Negotiations with a prospective farminee are at an advanced stage
which, if successful, will lead to retention of the licence and
drilling of the Panther well potentially sometime in 2008. Elixir and
its partner, Sosina, would see their respective 80% and 20% licence
interests diluted in return for a cost-carry through the Panther
Progress on Gawler Resources Merger
The Scheme documents for the proposed merger of Elixir and ASX-listed
Gawler Resources Limited ("Gawler") were lodged with the Australian
Stock Exchange ("ASX") and the Australian Securities and Investments
Commission ("ASIC") on 31 July 2007. Following ASX and ASIC review,
the First Court Hearing in the Federal Court in Perth, Western
Australia, approved the dispatch of the Scheme booklet to Gawler
Subsequent to period-end, Gawler share and option holders voted
overwhelmingly in favour of the merger at a meeting held on 19
October. The meeting results were then tabled at a Second Court
Hearing on 25 October where the Court formally approved the Scheme of
Arrangement which then became effective on 26 October.
The new Elixir shares and options will be allotted to Gawler
shareholders on 12 November and normal trading of these new shares in
the enlarged entity is expected to commence on the ASX on 13
The board and management of Elixir are very pleased that the Gawler
merger has finally been concluded. The creation of a balanced
pan-Atlantic exploration and production company will provide an ideal
platform for further growth.
During the quarter gas and oil production commenced at Gawler's High
Island A268 project in the Gulf of Mexico. Full details are available
in Gawler's September Activities Report (www.gawlerresources.com.au).
Convertible Note Issue
The issue of 10.7 million Elixir unsecured convertible notes at a
subscription price of A$0.25 was completed in early August raising a
total of approximately A$2.7 million before expenses.
The convertible note issue was arranged and underwritten by Argonaut
Capital Limited. The issue was made to Macquarie Bank Limited, AFM
Perseus Fund Limited and two other clients of Argonaut under Section
708 of the Australian Corporations Act. The notes are not quoted on
the ASX or AIM.
The funds subscribed are being employed in Gawler's enlarged field
development program in the Gulf of Mexico at High Island and Pompano
under a bridging loan arrangement that has operated during the merger
Following the successful finalisation of the merger, the notes are
convertible into Elixir shares at a price of A$0.25 per share at any
time up until 31 October 2008, or are redeemable at face value plus
interest on 30 November 2008.
2007 Annual General Meeting
The Company's Annual General Meeting for the 2006-07 year is
scheduled to be held at Level 31 Allendale Square, 77 St George's
Terrace, Perth, Western Australia, on 30 November 2007.
The 2007 Annual Report has been finalised and is being sent to
shareholders who have requested copies either by post or email. An
electronic version will be available for viewing and download from
the company's website (www.elixirpetroleum.com) shortly.
For further information please contact:
Elixir Petroleum Limited
Russell Langusch, Managing
Director +44 207 484 5623 (UK Office)
+44 7840 523 771 (UK Cell)
+61 411 725 858 (Australia Cell)
Michael Padley / Susan Scott +44 207 367 8888
Seymour Pierce Limited +44 207 107 8000
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