Roxi Petroleum Signs Option to Acquire ADA Oil

Roxi Petroleum has purchased an option to acquire 50% interests in ADA Oil LLP and ADA LLP (together the "ADA Group") that have 100% of the rights to two oil and gas assets located in the Aktobe Oblast of Kazakhstan.

The consideration for the option is US$2 million and the option is exercisable on or before 31 March 2008. On exercise of the option, the total consideration to acquire the 50% interests in the ADA Group is US$425 million.

Roxi has the option to pay the consideration in cash or by the issue of new Roxi Petroleum shares, or a mix of US$75 million in cash and US$350 million payable by the issue of new Roxi Petroleum shares. Any Roxi Petroleum shares issued as consideration for this acquisition will be issued at a price of 80p per share.

The option is subject to a number of conditions, including the completion of the previously announced acquisition of the 59% interest in Eragon Petroleum plc and the share price of Roxi being at least at an average of 80 pence per share for the 20 dealing days prior to the exercise of the option.

Following completion of the acquisitions of Eragon Petroleum plc and the ADA Group the maximum number of shares that could be issued for the acquisition of the ADA Group interests would represent approximately 46 per cent of the enlarged share capital of Roxi..

ADA Oil LLP operates the West Zhanazhol exploration contract in the Aktobe Oblast of Western Kazakhstan that contains two undeveloped fields. These are the Zhanatan field, which contains reservoirs in the Carboniferous KT-II carbonates and Visean sandstones, and the Bashinkol field, which has oil currently under test production from shallow Triassic sandstones. ADA Oil has also identified five further exploration structures and leads.

ADA LLP operates the Egizkara exploration contract area located 150kms northwest of West Zhanazhol. The block contains the shallow Cretaceous Egizkara discovery and five structural leads in the Mesozoic post salt sequence.

If Roxi exercises the option, the acquisition of the ADA Group interests would constitute a reverse takeover of the Company under the AIM Rules for Companies and would fall under the ambit of Rule 9 of the Takeover Code. Therefore, the completion would be conditional upon, inter alia, both the approval of the ADA Group acquisition by Roxi shareholders in a general meeting and upon admission of the enlarged share capital of Roxi to trading on AIM.

Roxi’s shares are currently suspended pending the publication of a re-admission document and shareholder circular in relation to the acquisition of Eragon Petroleum plc. Further details of the ADA Group option and the assets subject to the option will be provided on publication of that re-admission document later this year.

Commenting on the option agreement Rob Schoonbrood, Chief Executive Officer of Roxi said:

"I am delighted that Roxi has secured an option over these very exciting assets. The ADA Group assets together with the assets in Eragon Petroleum plc and the assets already owned by Roxi will make the Company a more significant presence in our chosen markets".