Elixir Reports Loss for Half Year

Elixir Petroleum Limited on Thursday announced its interim financial results for the six-month period to 31 December 2006. The results are stated in Australian dollars.

For the half year period the Company recorded a net loss of approximately A$2.3 million compared with a loss of A$3.0 million in the corresponding period of the previous year.

The interim 2006/07 results include writeoffs totalling A$1.3 million for unsuccessful and other capitalized exploration expenses. These were associated with UKCS 22nd Round licenses relinquished in December 2006 plus costs incurred during unsuccessful 24th Round applications.

The year-end accounts show cash funds at 31 December 2006 of about A$9.1 million (£3.6 million).

The Company adopts a conservative financing strategy whereby it adds value to its licenses before farming-out in return for a cost-carry through the initial drilling phase. By following this prudent approach, Elixir has adequate funds to progress its planned active exploration program over at least the next 12-18 months.

The Company has established a highly prospective portfolio of nine offshore licenses through successful licensing round participation and one acquisition.

In addition to this current primary exploration focus, Elixir is aggressively assessing development and production opportunities both in the North Sea and in other areas. The addition of future production would complement the Company's high impact exploration drilling activities by adding lower risk projects which provide sustainable cashflow. However any such acquisitions will only be secured if they add demonstrable shareholder value.