AYCO to Spud Onshore US Gulf Coast Well

The operator, AYCO, has advised First Australian Resources that the rig contracted for the drilling of the Pitchford-1 well, located onshore NE Waller in the US Gulf Coast (FAR, 34%) will arrive on site. Drilling will commence immediately and the well is expected to reach total depth on Tuesday, November 11, 2008 (US time).

The well, a planned 4500' Frio test, will be drilled on a turnkey basis by Progress Drilling of Luling, Texas utilizing a truck mounted rig. Positive results from this drilling will focus attention on the program's many shallow prospects and leads at Frio level.

The Pitchford-2 site preparation work has been completed and we have been advised by the operator that drilling is expected to commence within ten days. The well, a planned 7100' Yegua test, will be drilled by Black Creek Drilling, Inc and is expected to take ten days to drill.

Pipeline facilities exist within one mile of the proposed drill locations.

These first two wells have been selected from a large drilling inventory of shallow horizons. Details concerning the two prospects follow:

Pitchford-1 is a primary Frio target, F1, at a measured depth of 3,850 feet. Over 440 acres of closure are mapped at this level. The F1 zone displays a seismic amplitude anomaly believed to be a gas indicator. The Frio horizon immediately above the primary target, F2, also displays an amplitude anomaly. This location will test the edge of the F2. The well will be drilled to 4,500 feet to evaluate additional potential reservoirs still under closure.