ELIXIR ENERGY LIMITED — Capital/Financing Update 2008

Mar 31, 2008

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ASX RELEASE

1 April, 2008

POMPANO PROJECT – OPERATIONAL UPDATE – WELL #2

Elixir Petroleum Limited (“Elixir”) is pleased to provide an update on drilling operations on Well SL 103230 #1 (“Well #2”) at the Pompano Gas Field at Brazos Block 446-L SE/4.

Since our last announcement, the operator of the Pompano Project, AnaTexas Offshore Inc, has advised that the 5 ½” drilling liner has been run and set in Well #2 at a depth of 8,627ft Measured Depth (“MD”) and that the well has been subsequently drilled to a depth of 8,980ft MD in a 4 ½” hole size. The operator believes that we have now penetrated all of the target horizons and logging operations are presently underway in this final hole section.

Thus far Well #2 has encountered hydrocarbon bearing sands in the 6700, B, C and E sands. Once the F and G sands have been evaluated, a completion program will be developed, aimed at optimising production and recovery from the well.

The Participants in Well #2 and their respective working interests are:

Elixir Petroleum Ltd *	25.0%
Buccaneer Energy Ltd *	65.0%
Baron Petroleum Inc.	7.5%
Streamline Exploration Inc.	2.5%
	100%

• Interests held indirectly via their respective shareholdings in wholly-owned subsidiaries.

Elixir’s 25% working interest in Well #2 will be reduced by 5.5% pursuant to a ‘back-in’ arrangement with the Operator once Elixir has recouped 120% of its total investment in the well.

Yours sincerely,

Alex Neuling Company Secretary Elixir Petroleum Ltd

Golden Cross House 8 Duncannon Street London WC2N 4JF Tel: +44 207 484 5019 Fax: +44 207 484 4992 Website: www.elixirpetroleum.com

Level 20 77 St George’s Terrace Perth WA 6000 Western Australia +61 8 9440 2650 +61 8 9440 2699 ABN 51 108 230 995

Pompano Project – Background

The Pompano gas field lies offshore in the Gulf of Mexico, in Brazos Block 446-L SE/4, which is approximately 90 miles southwest of Houston Texas. The field is approximately 7 miles offshore in 55 feet of water.

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Schematic: Pompano Field Layout

The Pompano gas field was discovered in 1966 and produced over 120 billion cubic feet of gas prior to being shut-in in 2003. The Pompano Project is essentially a re-development of the Pompano gas field with new well locations based on modern 3D seismic data.

Well #1 was directionally drilled in January 2008 from the field’s existing “B” satellite platform to 7,825 feet measured depth. Well #1 intersected three gas bearing sands located between 6,700 feet and 7,426 feet measured depth which have been successfully flow tested. Production commenced from this well on Sunday 9[th] March 2008 from the B and 6700A sands.

Well #2 spudded in late February 2008 and is being directionally drilled from the field’s existing “A” Production Platform. Well #2 is targeting several sands which are anticipated to contain a combination of proved, probable and possible gas reserves.

The Pompano Project will use the field’s extensive existing production and pipeline facilities, which will achieve a significant capital cost saving and a reduction in time to production for the project.

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