Pan-Ocean Shareholders Approve of Addax Merger

Pan-Ocean Energy

Pan-Ocean Energy's shareholders approved the Scheme of Arrangement whereby Addax Petroleum will acquire substantially all of the assets and operations of the Company. Five separate meetings of shareholders were held to approve the Arrangement Agreement and related corporate matters with 99% of the Class A Common Shares and approximately 42% of the Class B Subordinate Voting Shares in attendance in person or by proxy. Of the shares voted at the meetings, 100% of the Class A Shares and 99% of the Class B Shares voted in favor. Separate class votes were held and the transactions were approved by a majority of the minority in compliance with Canadian Securities regulations. No dissenting rights were exercised.

On 20 July 2006, PanOcean announced that it had entered into an agreement with Addax Petroleum whereby Addax Petroleum will acquire 100% of the shares of the Company's wholly-owned subsidiary, PanAfrican Energy Corporation (Mauritius) Limited, which conducts all of PanOcean's operations which are based in Gabon, West Africa, as well as a subsidiary which provides management and operational services, for cash consideration of CDN$1.605 billion. Net proceeds, after payment of transaction related costs and a reserve for contingencies, will be used for the purchase and cancellation of all Class B Shares of the PanOcean at a price of approximately CDN$58.50 per share and all Class A Shares at a price of approximately CDN$65.80 per share.

The implementation of the Arrangement is subject to final approval by the Royal Court of Jersey, an application for which is scheduled for September 6, 2006, with proposed closing anticipated to be September 7, 2006.