Oil Basins Limited (ASX codes OBL & OBLO) was listed on the ASX on 23 August 2006 and is involved in exploration for oil and gas initially in the offshore Gippsland Basin waters of south-eastern Australia and the onshore Canning Basin of Western Australia. Since listing the Company has increased its leverage across all of its assets and has increased its exposure to attractive and prospective areas with the Canning Basin.

The key attributes of the Company’s exploration portfolio are as follows:

1. Attractive Gippsland / Canning Basin portfolio offering shareholders highly leveraged interests to a balanced portfolio of high and medium risk oil & gas
2. Exceptional leverage with Oil Basins owning formal legal rights to a 12.5% interest in Offshore Permit Vic/P41 – a highly prospective (medium risk) permit with six drill-ready 3D & AVO defined oil prospects including Kipling, Oscar West & Cotton of combined gross P10 prospective recoverable resources potential delineated as 713 MMbbls plus 3.1 Tcf (Gross Risked P10 Potential is presently estimated at 1,231 MMBoe).
3. The Vic/P41 permit is well situated nearby significant discoveries and developments including Basker/Manta, Kipper and Sole. In the northern area of the permit the Kipling/Benchley ‘wet gas’ prospects are ontrend on the Rosedale Fault to Kipper Development, whilst in the southern area of the permit the multiple Oscar ‘oil’ prospects are ontrend to the producing Basker FPSO Oil & Gas Hub. There is potential for future tie-backs to both facilities.
4. Very high leverage (at modest cost) to potentially a high reward “new stratigraphic play” the Backreef prospect within the Blina Back Reef Play Joint Venture Area to be drilled in mid-2008 in the Canning Basin, with Oil Basins owning rights to 50% net interest in this potentially a 270 MMBbls prospective recoverable resources potential oil target – net upside circa 135 MMBbls (importantly - nearby under-utilised existing infrastructure and within an existing production licence L6 – recently renewed in mid-2006 for 21 years and situated within 4 km of the Blina Oil Hub).
5. During 2007, the Company has also added to its Canning Basin portfolio with formal rights to 20% of Drilling Reservation DR9 and was recently successfully awarded along with its JV Partner Backreef Oil Limited a net 50% interest in Application Area L07-1.

6. On 11 July, 2008, OBL announced that the Company has concluded an agreement with the relevant Norwest Energy NL subsidiary to acquire a direct 10% interest in petroleum exploration Retention Lease R3 which contains the undeveloped Cyrano Oil Field, located in offshore Carnarvon Basin, Western Australia.

   The agreed consideration for this transaction is $26,667 plus 333,333 ordinary OBL shares with a gross booked cost translating to approximately $60,000. This interest of 10% is in addition to the previous OBL acquisition of a 15% interest in R3 announced to the ASX on 16 June 2008 however this interest of 10% did not participate in the drilling of the Cyrano-1 and Cyrano-2 wells. As such, no development is presently planned by the operator TAP Oil (TAP net 85%, OBL net 15%). This present acquisition represents a small consolidation at modest cost to increase OBL’s ownership in the R3 retention lease (TAP net 75%, OBL net 15%). However, by way of clarification, under the terms of the Joint Venture Agreement the additional 10% acquired by OBL may have impacted rights to income from a development at the Cyrano Discovery.

   The transfer is subject to the usual joint venture partner consents and formal registration with the West Australian Department of Industry and Resources. Both transactions are anticipated to be completed by August 2008. Post joint venture and regulatory approvals on both transactions, the new R3 lease holders will be:

   • Tap (Shelfal) Pty Ltd (“TAP Oil”, a wholly owned subsidiary of Tap Oil Limited) 75% (Operator)
   • Oil Basins Limited 25%

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Company’s Exploration Interests

The Company is intending to become involved in exploration for oil and gas initially in the offshore Gippsland Basin waters of south-eastern Australia and the onshore Canning Basin of Western Australia (refer to Figure 1) and has entered into formal farmin agreements so as to attain its initial project interests.

Company’s Exploration Interests