ELIXIR ENERGY LIMITED — Capital/Financing Update 2008

Jul 1, 2008

ASX ANNOUNCEMENT

ABN 51 108 230 995

2 July 2008 Company Announcements Platform Australian Securities Exchange Level 4 20 Bridge Street SYDNEY NSW 2000 By E-Lodgement

RESULTS OF ENTITLEMENT ISSUE

Elixir Petroleum Limited (“Elixir”), the international exploration and production company (ASX:EXR, AIM:ELP) advises that acceptances under the Company’s 1 for 8 entitlement offer (“Rights Issue”), as first announced to the market on 29 May 2008, closed at 5pm (WST) on 27 June 2008.

Valid acceptances for 1,950,550 shares were received, which represented a take-up of approximately 9.7%, raising for the Company new funds of $526,649. As previously disclosed by the Company, an agreement pursuant to which the Rights Issue was fully underwritten (“Agreement”) included various clauses which, if triggered, enabled the underwriter of the Rights Issue to terminate the Agreement at their option without cost to the Company. One of these clauses related to movements in the ASX Small Ordinaries Index, which has fallen by more than the trigger of 10% since the date of the Agreement. As a result, the underwriter has today delivered to the Company written notice of the termination of the underwriting arrangements with respect to the Rights Issue.

As stated in the Rights issue Offer Document, the Directors reserve the right under these circumstances to place any shortfall at their discretion and have successfully placed approximately 5.9 million shares at $0.27 per share to professional and sophisticated investors (“Shortfall Shares”), all of whom were sub-underwriters to the Rights Issue, raising for the Company a further $1.6 million gross.

Allotment of the Rights Issue shares has now occurred and Elixir expects that holding statements will be despatched to shareholders on or before 7 July 2008. An update on the allotment process for the Shortfall Shares will be provided in due course.

Commenting on the announcement, Elixir’s Managing Director, Andrew Ross said:

“Following the close of the Rights Issue and partial placement of the shortfall, Elixir has cash on hand of some $12 million, with additional receipts from monthly production of a further US$1.5 million expected in July. The Company’s cash reserves and its operating cash flow place it in a

ASX CODE: EXR www.elixirpetroleum.com

Elixir Petroleum Limited

Level 20, 77 St George’s Terrace PERTH WA 6000, AUSTRALIA T: +61 8 9440 2650 F: +61 8 9440 2699 E: info@elixirpetroleum.com

strong position to drive forward its business plan and to continue to pursue opportunities within and outside its current portfolio of interests.

“Timing of the Rights Issue has proved problematic with turbulent international market conditions further impacted locally by year-end tax considerations during June.

“We would however like to thank those shareholders and new investors who supported the issue and we look forward to an exciting period of further growth for the Company in the second half of 2008.”

Secondary Trading Exemption Notice

The Corporations Act 2001 (“Act”) restricts the on-sale of securities without disclosure, unless the sale is exempt under Section 708 or 708A of the Act. By Elixir giving this notice, on sale of shares issued under the Rights Issue will fall within the exemption offered by Section 708A (5) of the Act.

Elixir hereby notifies the ASX (as the operator of the prescribed financial market on which the Rights Issue shares are to be quoted) under Section 708A(5)(e) of the Act that:

• (a) Elixir issued the Rights Issue shares without disclosure to investors under Part 6D.2 of the Act;

• (b) As at the date of this notice Elixir has complied with the provisions of Chapter 2M of the Act as they apply to Elixir and with Section 674 of the Act; and

• (c) As at the date of this notice there is no “excluded information” as defined in Section 708A(7) and (8) of the Act in relation to Elixir.

Yours faithfully,

Alex Neuling Company secretary Elixir Petroleum Ltd

For further information, please visit Elixir’s website at www.elixirpetroleum.com

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