DIGITALX LIMITED — M&A Activity 2010

Aug 1, 2010

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ASX Announcement

2 August 2010

The Manager Company Announcements Office ASX Ltd 4th Floor, 20 Bridge Street SYDNEY, NSW 2000

Dear Sir,

STRATEGIC DEVELOPMENT

Verus Investments to Merge with Pass Petroleum

• Share only deal, includes a cash component from Pass

• Increase in working interest (WI) in Fausse Point project from 45% to 72%

 Immediate cash flow from Bullseye Miogyp production (WI of 10%)

 Undeveloped oil potential in the Camerina and Marg Varg formations at Bullseye (WI of 10%)

 Additional Bullseye prospects (Miogyp, Camerina and Marg Varg) ready to drill.  Includes potential high-impact project - Bowtie West (WI of 18%) – minimal capital requirements

 Right to acquire Silverwood (WI of 30%) – currently drilling

Verus Investments Ltd (Verus; ASX-code: VIL ) is pleased to announce that it has executed a term sheet with Pass Petroleum Pty Ltd (Pass) to merge Pass into Verus.

Office Address: Ground Floor, 30 Ledgar Road, Balcatta, Western Australia 6021 Postal Address: PO Box 717, Balcatta, Western Australia 6914 Phone: +61 (0)8 9240 8645 Fax: +61 (0)8 9240 2406 Email: info@verus.com Web: www.verus.com.au

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The merger marks a significant step forward for Verus with a substantial increased interest in the exciting Fausse Point project, the addition of an existing cash flow stream from Bullseye , - which includes the undeveloped oil potential in the Camerina Formation - as well as exposure to other high quality and impactful projects such as Bowtie West .

A scrip only deal, this transaction delivers diversification and breadth to Verus’ existing investments as well as proven reserves and an immediate cash flow stream from production at Bullseye which has potential to deliver additional reserves and production upside.

“We are fortunate to have secured this acquisition which both increases our participation in the Fausse Point project and brings a number of development properties that require only relatively minor capital commitments into our investment portfolio,” Verus Chairman Andrew McIlwain said.

“The Pass Petroleum team has a successful track record and have been responsible for introducing the Fausse Point project to Verus.

“As new Verus shareholders, the Pass team has committed to continue to assist in further developing the VIL petroleum portfolio.”

Mr McIlwain said at the conclusion of the transaction, Pass’ cash balance would also be transferred to Verus.

“Additionally, the currently producing Bullseye project provides approximately $35,000 per month cashflow which alleviates some capital requirements going forward,” he said.

“At this stage, the Silverwood prospect has been excluded from the transaction valuation.

“Together with Pass we recognise that estimating a fair value for Silverwoood, with drilling currently underway, is almost impossible.

“Accordingly, we have elected to have the right of first refusal to negotiate the acquisition of Silverwood once results of the drilling of the well are available.”

Terms of the merger are:

• Verus will issue approximately 370 million shares to Pass shareholders based on a merger ratio of 65%/35% (VIL:PPPL) at final closing;

• Pass may nominate one director to the Board of Verus;

• The merger is subject to the approval of shareholders of both Verus and Pass;

• A break fee of $500,0000 is payable (in shares) if either party fails to complete the transaction; and

• Subject to satisfactory final due diligence investigations.

The Verus Board of Directors consider that this acquisition opportunity provides a significant expansion and diversification of investments with the potential to secure future revenue streams and provide uplift in the share price.

Due diligence work has commenced and a merger agreement is currently being drafted.

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The necessary Notice of General Shareholder Meeting seeking approval for this transaction will be prepared and issued shortly.

Yours faithfully,

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Andrew McIlwain Chairman

For further information in respect of the Company’s activities, please contact:

Mr. Andrew McIlwain	Mr. Nathan Ryan	Mr. Paul Jurman /Mr. CraigNelmes
Chairman	NWR CommunicationsInvestor Relations	Finance & Administration
Tel:(+61 3)9817 5067	Tel:(+61 0)420 582 887	Tel:(+61 8)9240 8645

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About the Pass assets:

BULLSEYE – Pass WI: 10%

Introduction

The Bullseye project is located on the crest of the Laurel Ridge anticline onshore South Louisiana. Existing shallow normal pressured sands (10,100 ft to 10,600 ft) have produced approximately 146 BCF of natural gas and 4 MMBOE of crude oil, and are now depleted. Bullseye is currently producing from the deeper Miogyp Formation and has also discovered oil in another zone known as the Camerina. The Camerina Formation is yet to be tested and the project Operator at the Bullseye project estimates that it has the potential to contain 2.2 – 7.1 million barrels of oil and 2.0 – 7.0 billion cubic feet of gas. Pass has a 10% working interest in the project area which includes two producing wells, one water disposal, as well as substantial production infrastructure. The two producing wells, namely Jumonville #1 and #2. Jumonville produce around 250 barrels of high quality oil (40°API gravity) which, under the current sales contract, yields a premium to WTI. These wells also produce 300,000 cubic feet of gas per day. Bullseye has been a good producer and more recently operational costs have been lowered significantly with revised water disposal (Acosta #1) procedures allowing water disposal to vary according to production requirements which need less chemical injection.

Jumonville #1, Jumonville #2 and Acosta #1

Three wells have been drilled to date at Bullseye. Bullseye is currently producing from two wells – Jumonville #1 and #2.

Jumonville #1 was spudded on 28 April 2008 and reached a total depth of 12,440 ft on 28 August 2008. The well encountered both oil and gas in the Miogyp and Camerina objectives. Commercial production commenced from the Miogyp reservoir in September 2008. Jumonville #1 was shut-in as preparations were made for this well to be used for testing of the upper Camerina Formation, however, more recently it has been put back into production due to strong pressure build up and moderate oil and gas production. The reservoir at Jumonville #1 is believed to be connected to the reservoir at Jumonville #2, hence ultimately the latter well could be used to sweep the oil.

The Jumonville #2 well was spudded on 25 December 2008 and reached a total depth of 14,100 ft in April 2008. On 30 June 2009, Jumonville #2 successfully perforated and commenced production from the Miogyp sandstone with an initial production rate of 750 BOPD of crude oil and 250 MCFPD of natural gas. Current production is approximately 200 BOPD of crude oil.

Bullseye also contains the previously Noble drilled Acosta #1 well that was never tested. The Acosta #1 well was originally designed as an oil exploration well but failed in the primary Miogyp reservoir. The well has since been converted into a water disposal well providing significant cost reductions for the disposal of water from the Jumonville #1, Jumonville #2 wells and future wells.

Potential Extension of Miogyp Reservoir

The JV is currently reprocessing 3-D seismic over the Bullseye project area to evaluate the possible northeastward “mottled expansion” of the Miogyp Formation, which could potentially upgrade resources by 50%. Four possible development well locations have been identified, two wells are in the main Miogyp reservoir, with the location of the other two wells in the possible mottled extension of the Miogyp Formation.

Further Potential in Untested Hydrocarbon Intervals

The Camerina Sand was found to be oil bearing in the Jumonville #1, Jumonville #2 and Acosta #1 wells. Both Jumonville wells intersected and logged a 25-42 ft Camerina interval which has to date not been tested. The Camerina Sand is shallower than the Miogyp Formation and is a proven producer in the general area. The potential resource of the Camerina objective is estimated at 2.27.1 MMBBLS of crude oil and 2-7 BCF of natural gas, however, the extent of the reservoir is unknown. The Camerina Sand can be tested and produced from existing wells (most probably Jummonville #1) once the Miogyp Formation has been depleted. As mentioned previously testing of this zone has been postponed due to sustained improvement in the wells production levels from the Miogyp Formation.

Bullseye also contains an additional untested hydrocarbon interval called the Marg Varg Formation. Like the Camerina Formation the Marg Varg Formation is a proven producer in the general area. At this stage the distribution of the Marg Varg reservoir is not well defined as the depth of oil-water contact is unknown.

BOWTIE – Pass WI: 18%

Introduction

The Bowtie West prospect is located in a prolific fairway of previously developed shallower large oil and gas fields. Bowtie West offers a large gas prospect with good follow on drilling potential. Bowtie West is a follow-on to a dry hole (Bowtie East) that missed the Vicksburg sandstone reservoir. Despite the dry hole, Bowtie West has been upgraded by other recent discoveries in the immediate area.

Bowtie West is scheduled to be drilled in 2H 2010.Total dry hole cost for Bowtie West is estimated to be US$2.7million. Estimated completion cost is approximately US$400,000. Abundant production infrastructure exists in the nearby area hence any discovery can be quickly brought into commercial production.

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Bowtie West has a strong amplitude anomaly that extends widely over the prospect. The dry hole at Bowtie East did not have this amplitude anomaly. The seismic also clearly shows the down-dip Halbouty well on this prospect to have missed the amplitude anomaly and the Heckendorn well making a major discovery in the Bowtie Vicksburg formation. The Bowtie Vicksburg is a deeper overlooked play and located near several recent discoveries with large flow rates and per well recoveries. For example, the Heckendorn well achieved an initial production rate of over 8 MMCFPD of natural gas and 560 BCPD of condensate. Cumulative production is 14.1 BCF of natural gas and 155 MBO of condensate.

Resource Potential

Bowtie West represents a relatively low risk exploration prospect with estimated potential reserves of over 50 BCF of natural gas and around 1.7 MMBBLS of crude oil. As mentioned previously the reservoir sands at Bowtie West are visible on seismic with strong amplitude anomaly that extends widely over the prospect and could represent a much larger prospective reserve than current estimates. The strong amplitude anomaly equals thick reservoir sand which has been calibrated in nearby prolific Vicksburg producers.

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