Australian Worldwide Exploration Comments on NZ Tax Changes

Australian Worldwide Exploration refers to a media release made by the Policy Advice Division of the Inland Revenue Department of New Zealand on March 4, 2008. A number of brokers and investors have enquired as to the materiality of this announcement to the AWE group, an excerpt of which is attached as Appendix 1 to this release.

AWE advises that the New Zealand operations of the AWE group will not be materially impacted by this proposed change and that the net effect based on current forecasts is less than A$5 million.

Exploration expenditure incurred in New Zealand, including expenditure in New Zealand offshore waters, is still tax deductible to New Zealand resident AWE group companies.

The effect of the proposed change in tax legislation, if enacted, would be to prevent New Zealand companies claiming tax deductibility for exploration expenditure incurred in overseas jurisdictions other than New Zealand.