FirstAfrica Oil Proposes Share Consolidation

FirstAfrica has posted a circular to its shareholders relating to a proposed 1 for 50 share consolidation.

As shareholders are aware the Company is in the process of marketing to qualifying investors to raise up to US$53.9 million through a placing of new ordinary shares of 0.1p each nominal. This marketing process is expected to continue until October 20, 2006 but, following several meetings, it has become clear that there is a desire from certain significant shareholders for the Company to undertake a share consolidation in order to make the number of ordinary shares in issue more manageable. This would also potentially make the share price more attractive to prospective investors and reduce the bid/ offer spread quoted in the market.

The Circular convenes an EGM for 11.00 a.m. on October 26, 2006, at which a resolution will be proposed to approve the share consolidation to reduce the number of authorized and issued ordinary shares as soon as possible following the admission of all of the Placing Shares to AIM ("Placing Admission"). As disclosed in the circular to shareholders of October 3, 2006 the Placing Admission is expected to occur at 8.00 a.m. on October 27, 2006 and therefore the earliest that the Share Consolidation could be effected and the new ordinary shares of 5p each nominal ("New Ordinary Shares") traded is 8.00 a.m. on October 30, 2006. A delay in the Placing Admission will have a consequential delay in the Share Consolidation and admission of the New Ordinary Shares.

Full details are set out in the Circular, a copy of which is available on the Company's website.