COMET RIDGE LIMITED — Capital/Financing Update 2011

May 12, 2011

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13 May 2011

OPERATIONAL UPDATE – NZ AERIAL SURVEYING

• Aerial survey programme completed, totaling 9,300 line km or 2,910 sq km of data

• Data processing and analysis has commenced

• Drilling expected to begin prior to end of 2011 calendar year

Australia and New Zealand Coal Seam Gas (CSG) explorer Comet Ridge Limited (ASX:COI) today announced the successful completion of the aerial survey programme over key areas of its New Zealand CSG acreage.

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Comet Ridge Managing Director Tor McCaul said the company was pleased to announce that the Airborne Gravity Gradiometry (AGG) survey programme had been completed and that data processing and analysis has commenced.

Drilling of the first CSG targets was expected to begin by the end of the 2011 calendar year.

“We have completed surveying 2,910 square kilometres of our key New Zealand CSG acreage, with the aircraft acquiring approximately 9,300 line kilometres of data,” Mr McCaul said.

“This completes Comet Ridge’s two-phase acquisition programme which began in 2010 with the acquisition of aeromagnetic data over all our New Zealand acreage, followed by this year’s acquisition of AGG data across key areas within the Waikato and Buller areas as well as all of the Greymouth area.

Figure 1 - West Coast AGG Survey Area

The AGG survey system was developed in the coal industry to discover new coal deposits and to help outline known coal resources with greater accuracy.

Comet Ridge Limited T: +61 7 3221 3661 E: info@cometridge.com.au 283 Elizabeth St, Brisbane, Qld, 4000 Australia ABN 47 106 092 577 F: +61 7 3221 3668 W: www.cometridge.com.au GPO Box 798, Brisbane, Qld, 4001 Australia

ASX CODE: COI

Comet Ridge Limited

“The deployment of this system is a first for New Zealand’s CSG industry. By measuring and analysing the magnetic properties and density of the rock layers and calibrating with existing well and seismic data, conclusions can be drawn about the depth, thickness and aerial extent of coals in Comet Ridge’s New Zealand blocks. This will provide valuable information on the location of the highest value CSG targets within Comet Ridge’s permit areas.”

Mr McCaul said he was extremely pleased with the results to date and was looking forward to having the data set interpreted and integrated into Comet Ridge’s current geological models across the company’s New Zealand exploration blocks.

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“The data will be processed immediately and incorporated into our geologic models. We expect a high resolution dataset to be available that will aid in the identification of targets ahead of our next drilling campaign,” he said.

Figure 2 – Greymouth AGG Survey Area

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Stephen Rodgers Company Secretary Comet Ridge Limited

For further information please contact:

Tor McCaul Managing Director Comet Ridge Limited tor.mccaul@cometridge.com.au +61 7 3221 3661

Media: Rhyll Cronin Principal Consultant Three Plus rhyll@threeplus.com.au +61 7 35035700

Comet Ridge Limited T: +61 7 3221 3661 E: info@cometridge.com.au 283 Elizabeth St, Brisbane, Qld, 4000 Australia ABN 47 106 092 577 F: +61 7 3221 3668 W: www.cometridge.com.au GPO Box 798, Brisbane, Qld, 4001 Australia

ASX CODE: COI 2 of 3

Comet Ridge Limited

COMET RIDGE LIMITED - OVERVIEW

Comet Ridge Limited has significant Coal Seam Gas (CSG) projects in key regions of Queensland, northern New South Wales and New Zealand, as well as oil and gas interests in the United States. Gas resources have been independently certified at three projects. The company is listed on the Australian Securities Exchange (ASX Code: COI) and is based in Brisbane. The Board and Management are experienced in establishing and developing energy projects.

Corporate Strategy

Comet Ridge has gained early entry into well-located exploration areas, allowing shareholders to gain substantial leverage into the upside value potential associated with exploration success.

Comet Ridge conducts CSG exploration and appraisal, with the aim of maturing exploration acreage from Gas Resources into Proven and Probable Gas Reserves. This process initially involves drilling wells in order to certify Prospective and Contingent Resources and then through further appraisal via Pilot Projects, progressing into certified Reserves.

Where possible, Comet Ridge takes high equity positions in its large exploration permits, including a 100% interest in both its Galilee Basin and New Zealand assets. Comet Ridge has 40% equity in the ATP 337P Mahalo block in the Bowen Basin, and holds 25% and 40% equity respectively in PEL 427 and PEL 428 in NSW.

Certified Resources

In executing our strategy, Comet Ridge has successfully independently certified the following Prospective and Contingent Resources:

Comet Ridge Limited – Net Recoverable Resources	Comet Ridge Limited – Net Recoverable Resources	Comet Ridge Limited – Net Recoverable Resources
Project	Location	ContingentResource(PJ)	ProspectiveResource(PJ)
Gunn Project Area(ATP 744P)	Galilee Basin, Qld	1,870	597
Mahalo Block(ATP 337P)	Bowen Basin, Qld	442	-
PEL 427 and PEL 428	Northern NSW	231	1022
Total		2,521	1,415

Work Program

Comet Ridge has an active exploration and appraisal work program for CSG projects in Queensland, northern NSW and New Zealand. The first Pilot Project for ATP 337P Mahalo is planned for 2011, with additional exploration and appraisal work planned for the Galilee Basin, northern NSW and NZ.

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Comet Ridge Limited T: +61 7 3221 3661 E: info@cometridge.com.au 283 Elizabeth St, Brisbane, Qld, 4000 Australia ABN 47 106 092 577 F: +61 7 3221 3668 W: www.cometridge.com.au GPO Box 798, Brisbane, Qld, 4001 Australia

ASX CODE: COI 3 of 3

Comet Ridge Limited