Carnarvon Petroleum's Share Purchase Plan Oversubscribed

Carnarvon Petroleum says that its Share Purchase Plan closed oversubscribed, with applications received for $1.46 million in respect of the $1 million SPP.

As a result of this oversubscription Carnarvon has determined that, consistent with the SPP announcement on August 2, 2006, the applications for shares to be issued under the SPP will be scaled back as follows on a basis that treats all shareholders equitably and fairly.

Eligible shareholders will receive a check for any application funds not applied in accordance with the terms of the SPP. Each eligible shareholder that is being issued shares under the SPP will receive a notice that sets out the number of shares they have been allotted. Shares will be allotted once all funds have been cleared.

Carnarvon's CEO Ted Jacobson commented:

"We are delighted by the response to the SPP and are encouraged that our recent initiatives have been so well received by our existing shareholders, with 348 shareholders applying for shares in the SPP. The SPP allows all shareholders to participate at the same price as our share placement in early August. The funding will allow the Company to consolidate its cash reserves and accelerate both the Phase 1 and Phase 2 drilling programs."

Shares Applied For		Share Allotted		Subscription
100,000				68,493			$3,424.66
50,000				34,247			$1,712.33