ELIXIR ENERGY LIMITED — Capital/Financing Update 2008

Sep 21, 2008

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ASX RELEASE – 22 SEPTEMBER 2008

POMPANO PROJECT – DRILLING OPERATIONS COMMENCED

Buccaneer Energy Limited (“Buccaneer” or “the Company”) is pleased to announce that AnaTexas Offshore (“AnaTexas” or “the Operator”) has advised that Hercules Rig 152 has arrived on location and commenced operations to drill well SL 103230 # 4.

SL 103230 # 4 will be directionally drilled from a new caisson to be driven outboard, but immediately adjacent the # 5 Caisson which is located approximately 3,000 feet southwest of the A Production Platform. The well will be drilled into an adjacent fault block to the recently successfully completed SL 103230 # 1.

The primary objective of SL 103230 # 4 is to test up to 6 sand reservoirs including developing remaining reserves in the 6700 ft, B, C and E sands, which are the main objectives of the well. It is not intended to test any potential objectives below the E Sand.

The current drilling plan has allocated a 25 day drilling time and an additional 22 days to complete the well for production. Once the well has been completed it is anticipated that production will commence within 21 days as existing flow lines connecting the # 5 Caisson location to the A Production Platform will be utilised.

Drilling updates will be given on a weekly basis commencing on Tuesday 30 September 2008. Hydrocarbon shows will not be reported until the well has been completed and logged.

Pompano Production Recommenced

The Operator has also advised that production at Pompano from the first two wells has recommenced after power was restored to the land base processing facilities, production rates are currently building up to pre shut‐ in rates.

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The Participants in SL 103230 # 4 well are as follows:

The Participants in SL 103230	# 4 well are as follows:
Participant	Working Interest
Buccaneer Resources*	65.0%
Elixir Petroleum	25.0%
Baron Petroleum+	7.5%
Streamline Exploration+	2.5%

• A wholly owned subsidiary of Buccaneer Energy Limited

• Affiliated with AnaTexas Offshore, Inc. Baron Petroleum and Streamline Exploration are members of Millennium Explorer, LLC., the generator of the Pompano project.

For further information please contact Dean Gallegos on 0416 220 007 or 02 9233 2520, alternatively visit the Company’s website at www.buccenergy.com.

Yours faithfully BUCCANEER ENERGY LIMITED

Mr Dean Gallegos Director

About Buccaneer:

Buccaneer Energy’s wholly owned subsidiary Buccaneer Resources is based in Houston, Texas and is an upstream oil and gas company. It specialises in the development and expansion of behind‐pipe proved and probable reserves and low‐risk exploration plays with growth potential.

Buccaneer’s growth strategy is focused on the progressive expansion of oil and gas production and reserves by acquiring significant working interests in low‐cost, low‐risk development properties that possess significant undeveloped upside.

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