Black Roc Comes to Terms on Las Quinchas Association Contract

The board of Black Rock Oil agreed on the terms of an arrangement to further develop the company's interests in the Las Quinchas Association Contract. Prospero Hydrocarbons Inc agreed to invest up to U.S. $4 million (in tranches matching the cash calls required in respect to Las Quinchas) for an equity interest of 49% in Las Quinchas Resource Corp which now holds Black Roc's interests in the Las Quinchas Association Contract in the Middle Magdalena Valley of Colombia. Additionally, Prospero's management will assist in technical evaluations and a nominee of Prospero will join Black Roc's board.

"We are delighted to have concluded this increased participation with Prospero and look forward to working with them on our Colombian assets," John Cubitt, managing director of Black Rock Oil, commented.

Black Rock has assigned its interest in the Las Quinchas Association Contract to a wholly-owned Barbados-based subsidiary, Las Quinchas Resource Corp which has entered into a subscription agreement with Prospero. Initially Prospero has subscribed for 425,298 shares of common stock in Las Quinchas Resource, representing 0.83% of the issued share capital of Las Quinchas Resource for a cash consideration of U.S. $347,182. Prospero has agreed to invest a further U.S. $3,652,818 for shares representing up to 49% of Las Quinchas Resource as and when Las Quinchas Resource requires funding for the continued development of Las Quinchas, including Acacia Este. In consideration for each payment by Prospero, Las Quinchas Resource will issue Prospero further shares of common stock in Las Quinchas Resource.

Black Rock has provided a number of representations and warranties pursuant to the Las Quinchas Agreement.

Black Rock and Prospero have also entered into an investors' agreement in respect of Las Quinchas Resource. Pursuant to the Las Quinchas Investors Agreement, both Black Rock and Prospero can appoint one director to the Board of Las Quinchas Resource. The Las Quinchas Investors Agreement contains certain drag and tag rights, and grants Black Rock and Prospero a right of first refusal over each other's shareholding in Las Quinchas Resource in the event that any party which owns more than 50% of Las Quinchas Resource subsequently seeks to sell, transfer, assign or otherwise dispose of its shareholding in Las Quinchas Resource.

Following full subscription by Prospero under the financing, Black Rock will retain a 51% shareholding in Las Quinchas Resource and will continue to consolidate its Colombian interests in its consolidated accounts. As of June 30, 2007, Black Rock's Colombian interests had a net book value of $5,891,512 and made a loss before taxation of $644,684.

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