First Australian Resources Raises $12.4 Million for Exploration Program

First Australian Resources has reached an in-principle agreement with Hartleys Limited to raise $12.4 million through the placement of 95,000,000 shares, predominately to British, North American, Asian and domestic institutional clients of Hartleys Limited.

Together with the $13.5 million on hand as at March 31, 2006, the Company is now fully funded for what will be a world class exploration program emanating from its Houston office, the highlights of which include:

  • A 3D seismic survey to be conducted on the Deep Water Offshore Senegal blocks to further refine the prospects and leads (including large turbidite fans) identified on reprocessed 2D seismic by JV partner Hunt Oil, a number of which are capable of hosting several hundreds of millions of barrels of oil;
  • Multiple wells to be drilled in the Gulf of Mexico including Offshore Galveston Bay (rig contracted for 15 July 2006) and Lake Long Deep;
  • Two gas plays at Kakwa (approaching target depth) and Clear Hills in Alberta, Canada, where gas has already been discovered in both projects; and
  • Offshore China where the Joint Venture awaits confirmation of multiple oil and gas zones recorded while drilling the Wei 6-12-South wildcat well.

The shares will be allotted subject to shareholder approval being obtained at a General Meeting to be held on June 9, 2006.

Commenting on the proposed placement, Executive Chairman Michael Evans said:
"FAR has now secured a class of shareholder that can match the company's growth ambitions. The ability of FAR to attract this level of support reflects not only its maturing status as an oil and gas producer and explorer but also the high caliber of its exploration portfolio, particularly West Africa and North America. "