COMET RIDGE LIMITED — Capital/Financing Update 2007

Feb 5, 2007

COMET RIDGE LIMITED ASX ANNOUNGEMENT 6 FEBRUARY 2007

The Company Announcements Officer Australian Stock Exchange Limited Exchange Centre 20 Bridge Street SYDNEY NSW 2000 By Electronic Lodgement

OPERATIONS UPDATE TOW CREEK & BEAR RIVER PROJECTS. ROUTT COUNTY, COLORADO, USA

MAIN POINTS

• Attempts to free stuck drill string at Coal View Unit 31-4 to be extended for another two days due to some progress being made
• Peltier 11-12 perforated liner successfully run to total depth, waiting on Diamondback completion rig to equip well for testing and production

The directors of Comet Ridge Limited (ASX Code: COI) provide the following operational update for the Tow Creek and Bear River prospects in Routt County, Colorado, USA.

TOW CREEK (Comet Ridge 37.5% and Operator)

As of report time (3pm, 5 February Denver time - 7am, 6 February Perth time) the Diamondback Energy completion rig was still attempting to recover part of the work string that is stuck in the hole at 5,317 feet. Some progress was made over the weekend so the recovery attempts will continue for another two days.

Oil and gas continue to be produced in the circulating mud stream. This and the presence of extensive fracturing in the main reservoir horizons (the first and second benches of the Niobrara Formation) provide significant incentive to continued attempts to complete the well.

Should the fishing attempts prove unsuccessful; the well will be temporarily suspended until a drilling rig can be brought in to complete the fishing job or to sidetrack the well.

BEAR RIVER (Comet Ridge 33.75% and Operator)

The Peltier 11-12 well reached a total depth of 6,700 feet on 31 January. The well was drilled under budget and faster than projected. A 5 $\%$ inch production liner was successfully run to total depth, with 700 feet of perforated pipe being set across three reservoir intervals (the first, second and third benches of the Niobrara Formation).

Preliminary interpretation of the drilling parameters, geological samples and the electric line logs, including a specialised imaging tool, concluded that the all three reservoir targets, the first, second and third "benches" of the Niobrara Formation are fractured (the

AUSTRALIA Level 9, Wesfarmers House 40 The Esplanade, Perth WA 6000 Phone: 61 8 6464 0499 61 8 6464 0498 Fax:

USA 600 17th Street, Suite 600-S Denver, Colorado 80202 Phone: +1 (303) 226 1300 Fax: +1 (303) 226 1301

Comet Ridge Limited ABN 47 106 092 577 Email: comet@cometridge.com.au Website: www.cometridge.com.au

fractures provide the flow path and storage mechanism in these reservoirs). Oil and gas shows, including an incidence of free oil in the mud pit, were observed throughout all three objectives.

Cyclone Rig 16 was released from the Pettier 11-12 on 4 February, 2007.

The well will be completed for testing/production with the Diamondback Energy rig currently on the CVU 31-4 well. The completion simply entails running an electric submersible pump to TD and installing temporary power and production facilities.

Drilling on the Tow Creek/Bear River project will resume in the second quarter.

Comet Ridge and partner Strike Oil Limited (ASX Code: STX) funded the drilling of these two wells 50:50. Following completion of the Peltier well, all earning requirements on the Bear River prospect will have been completed. Once the CVU 31-4 well is completed, all earning requirements for the Tow Creek project will have been fulfilled.

Effective immediately the Company will issue operational updates to the ASX on Tuesdays rather than Fridays.

Yours sincerely

حويمكم

ANDREW LYDYARD Managing Director Comet Ridge Limited

For further information contact: Andy Lydyard (USA) Managing Director Phone: +1 (303) 226 1303 Fax: $+1$ (303) 226 1301 Mobile: +1 (303) 547 4478 Email: andyl@cometridgeusa.com