ELIXIR ENERGY LIMITED — Interim / Quarterly Report 2008

Apr 29, 2008

==> picture [125 x 101] intentionally omitted <==

ASX RELEASE

30 April, 2008

QUARTERLY ACTIVITIES REPORT FOR THE PERIOD ENDED 31 MARCH 2007

HIGHLIGHTS

• Quarterly production revenue from High Island 268-A of US$2.38 million

• Pompano Well #1 intersected commercial gas pay and was completed as a producer

• Pompano JV elected to commence drilling Pompano Well #2

• Farm out activities continue on several UK North Sea licences

• Farmed into and assumed operatorship of highly prospective Block SL-4 offshore Sierra Leone, West Africa

• Commenced 1,222 km[2] 3D seismic data acquisition programme over Block SL-4

STRATEGY

Elixir is an internationally focused upstream oil and gas company with a diversified portfolio of offshore petroleum interests across the exploration, appraisal, development and production lifecycle.

Elixir’s business strategy is to acquire interests in exploration licences with high impact potential, to work up prospects internally and to farm these out to industry to drill, typically on a full carry basis. Complementing this exploration strategy is the addition of lower risk oil and gas development projects with appraisal upside located in the shallow waters of the Gulf of Mexico. These projects typically demonstrate a short cycle time to production and provide cashflow for the Elixir Group.

The Board of Elixir considers it important to remain flexible in the pursuit of new business opportunities which are judged to be complementary to its existing business activities and able to deliver superior growth in shareholder value.

DEVELOPMENT AND PRODUCTION

Gulf of Mexico

Project Name: High Island Project (Block 268A) Location: High Island Area, Offshore Texas, USA Ownership: 30% Working Interest (22.5% Net Revenue Interest) Operator: Peregrine Oil and Gas, LP

Wells A-1 and A-2 at High island discovered gas and condensate pay in two separate accumulations, with each well currently only producing from the lower of the two reservoir zones. In the three month period to 31 March 2007, the following production results were achieved:

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

High Island 268-A			Gas Production	Gas Production				Oil Production	Oil Production
	Total Mar Qtr (MMscf)	Total Dec Qtr (MMscf)	Avg Daily Mar Qtr (MMscf/d)	Avg Daily Dec Qtr (MMscf/d)	Change (%)	Total Mar Qtr (Bbls)	Total Dec Qtr (Bbls)	Avg Daily Mar Qtr (Bbls/d)	Avg Daily Dec Qtr (Bbls/d)	Change (%)
Project (100%)	568	1,418	6.2	15.4	-59.7	30,373	16,860	338	183	+184.7
Elixir (30% WI)	170.4	468	1.9	4.5	-57.8	9,112	5,058	100	55	+181.8

There was a total of 5.8 days downtime during this period, giving an average uptime of 93.7%. There were no safety incidents reported in the period.

In the normal course a lag of two months is experienced from the month of production to receipt of sales income. Accordingly, receipts in the quarter were for production in the months of November 2007 to January 2008. Sale receipts for the months of November 2007 to January 2008 totalled approximately US$2.38 million. The average price realised for the sale of gas produced in these months was US$7.12/Mcf, and for oil was US$90.90/Bbl.

Production of gas and oil from Well A-2 remains relatively stable, although the well is exhibiting a slow, natural decline in production over time, which is in accordance with expectations.

As reported last quarter, a significant increase in oil and water production from Well A-1 has been observed. This was expected, and is believed to be due to the presence of an oil rim which overlays the water leg in the reservoir. Following three months of stable production from Well A-1 to late December 2007, it is thought that the oil / water contact in the reservoir has now risen, such that the oil rim and underlying water leg is being accessed and produced by the well bore.

The increase in oil and water production has reduced the ability of the well to produce gas from the lowest perforated interval in the well. Consequently, along with the increase in oil and water production, we have observed a related decline in gas production from Well A-1 in the quarter. Once gas and oil rates stabilised in January, their trends have subsequently indicated a gentle decline in pressure and further movements of contacts with slowly increasing water cut and decreasing oil.

The High Island joint venture has agreed to continue to produce the lowest zone in Well A-1 to attempt to recover as much oil as possible. If over time the well is not able to continue to lift the volumes of oil and water delivered by the reservoir at this level, the sliding sleeve over the lowest perforations in the well will be closed and a sliding sleeve approximately 50 feet shallower up the wellbore (but still in the same reservoir zone), will be opened. In undertaking this operation, it is anticipated that higher gas flow rates will be re-established in Well A-1 from this reservoir interval. Additional reservoir modelling studies are currently being undertaken to assist with our understanding of the flow behaviour of Well A-1.

Project Name: Pompano Gas Project (Block 446-L SE/4) Location: Brazos Area, Offshore Texas, USA Ownership: 25% Working Interest (18.125% Net Revenue Interest) Operator: AnaTexas Offshore Inc.

The Pompano gas field lies in the Gulf of Mexico, in Brazos Block 446-L SE/4, which is approximately 90 miles southwest of Houston, Texas. The first well on Pompano, SL103229#1 (“Well #1”), was directionally drilled from a new caisson installed adjacent to the field’s existing “B” satellite platform during the quarter.

2

Well #1 was designed to test several potentially gas bearing sands located between 3,800 feet and 7,900 feet Measured Depth (“MD”). Well #1 reached total depth on 26 January 2008 at 7,821 feet MD. Gas returns in the mud were encountered whilst drilling the primary targets. Several zones were logged while drilling and were found to be gas bearing in the 6,700, A and B Sands. Following measurement of formation pressures, the logged pay encountered was considered commercial and the joint venture elected to complete Well #1 as a producer.

Completion activities on Well #1, together with platform and flow line refurbishment activities were finalised in late February and the well was placed on production on 9 March 2008, some 8 weeks after spudding the well. Initial production rates of approximately 7 MMscf/d were achieved. In the 3 weeks from the commencement of production to the end of the quarter, the following production results were achieved:

Pompano Field Brazos Block 446-L	Gas Production	Gas Production	Condensate	Production
	Total Mar Qtr (MMscf)	Avg Daily Mar Qtr (MMscf/d)	Total Mar Qtr (Bbls)	Avg Daily Mar Qtr (Bbls/d)
Project (100%)	130.0	5.7	240.0	10.4
Elixir (25% WI)	32.5	1.4	60.0	2.6

There was a total of 0.6 days downtime during this period, giving an average uptime of 97%, which is an excellent result for a commissioning and start-up period. There were no safety incidents reported in the period. First receipts from sales of gas and condensate are due to be received in May 2008.

Following the success of Well #1, the joint venture participants elected to drill SL103230#1 (“Well #2”) at Pompano immediately upon the finalisation of completion activities on Well #1. At the conclusion of the quarter, Well #2 had reached Total Depth of 8,981 ft and preparations were underway for logging the final hole section. At the date of this report, logging, testing and completion activities had concluded and Well #2 was being prepared to be placed on production.

APPRAISAL

UK North Sea

Project Name: Mulle Prospect (Block 211/22b) Location: Northern UK North Sea Ownership: 40% Working Interest Operator: DNO (UK) Limited

During the drilling of the Jaguar well in early 2006 significant hydrocarbon shows were encountered in the Brent Formation. Subsequent technical work has indicated the potential for oil entrapment up-dip of the Jaguar well location. This up-dip accumulation, which was penetrated by a discovery well drilled in the 1970’s, has been named Mulle by the joint venture.

The Mulle accumulation lies on the south-western extension of the Osprey ridge and is adjacent to the proposed Causeway oil field development which has achieved flow rates of up to 14,500 barrels of oil per day on test.

3

An appraisal well and testing programme is being planned for the Mulle accumulation in order to further define the areal extent of the reservoir, to identify oil/water contacts and to test reservoir deliverability. The joint venture has agreed to invite partners into the project to participate in the proposed appraisal programme. To this end, an online data-room is being prepared which will be opened shortly for a select group of invitees. Synergies are being considered with respect to the Causeway development, planning for which is at an advanced stage.

EXPLORATION

UK North Sea Project Name: Leopard Prospect (Block 211/18b) Location: Northern UK North Sea Ownership: 56% Working Interest Operator: Elixir Petroleum Limited

Block 211/18b (Licence P1381) is a traditional licence awarded in the 23[rd] Seaward Licensing Round in December 2005. The interest holders in P1381 are Elixir (56%), RWE Dea UK SNS Limited (30%) and Sosina Exploration Ltd (14%). Under the terms of a farm in agreement finalised with RWE in August 2007, RWE will be contributing on a promoted basis to the cost of drilling an exploration well on the Leopard prospect which lies within the block.

Efforts to secure another farminee in order to largely cover Elixir’s and Sosina’s cost exposures in the proposed Leopard well are ongoing with several companies currently assessing the opportunity.

Testing of 3D seismic data relating to a site survey was initiated during the quarter, a prior requirement to drilling operations commencing. In the event a full site survey is required, discussions have also been initiated with contractors on the availability of survey boats for second half of 2008. The availability of suitable drilling rigs has improved over recent months with opportunistic wells slots becoming available in late 2008. Provided the Leopard farmout can be concluded in the near term, we remain confident that the well can be drilled during 2H, 2008.

Project Name: Bobcat Prospect (Block 21/16b) Location: Central UK North Sea Ownership: 40% Working Interest Operator: Elixir Petroleum Limited

Good progress has been made on Promote Licence Block 21/16b during the quarter with all prerequisite technical work having been finalised to allow farm out activities to commence. State-of-the-art fluid inclusion studies of a number of wells already drilled in the area have demonstrated the movement of hydrocarbons through the area and proved a hydrocarbon migration pathway across the block. The studies have also revealed that a historic well drilled on the block that was formerly thought to be a dry hole, in fact contains hydrocarbon shows and provides additional support for the Bobcat prospect.

A data room will be opened at the end of April to market the opportunity to industry.

Project Name: Fat Cat Prospect (Block 13/25) Location: Central UK North Sea Ownership: 12.5% Working Interest Operator: Petro-Canada

Block 13/25 (Licence P1404) is a promote licence that was awarded in the 23[rd] Seaward Licensing Round in December 2005. The initial approval of the merger of Block 13/25 with the adjacent Block

4

13/24d was achieved in late 2007, with Petro-Canada assuming operatorship of the merged block. The relinquishment of part of the northern section of 13/25 was also approved at the same time.

At the conclusion of the quarter the joint venture is still awaiting receipt of the Deed of Variation from the UK regulator, which confirms the change in the terms of the two merged licences and approves the forward work programme. When the Deed is received, a budget for 2008 and cash calls can be approved by the joint venture.

In the meantime, high resolution 2D data has been acquired over Blocks 13/25 and 13/24 by PetroCanada and the 2D seismic data has been processed. The joint venture remains on schedule to complete the interpretation of the data set by the end of Q2, 2008.

West Africa - Sierra Leone

Project Name: Block SL-4 Location: Offshore Sierra Leone Ownership: 35% (comprising 15% Working Interest, and 20% Optional Interest) Operator: Elixir Petroleum (UK) Limited

An interest in Block SL-4 was assigned to Elixir on 20 February 2008. At that time, Elixir was also approved as operator of the licence. Block SL-4 comprises an area of 4,429 km[2] lying in water depths from 100m to over 3,500m offshore Sierra Leone, West Africa.

As the operator of Block SL-4, Elixir contracted a leading seismic acquisition contractor in March to undertake a 1,222 km[2] 3D seismic survey of the Block on behalf of the joint venture. The 3D survey is designed to better define and mature the large number of significant leads and play types identified from 2D seismic data acquired over Block SL-4 in 2003.

The vessel conducting the survey commenced acquiring data on Block SL-4 on 30 March 2008 and at 28 April 2008 had acquired 437 km[2] , representing 36% of the total shoot area. It remains our expectation that on a trouble free basis, seismic acquisition activities will be completed and the vessel released by early June 2008. The data acquired will be processed in Europe by the seismic contractor, ahead of detailed interpretation studies by Elixir’s exploration team based in England.

The undertaking of the 3D seismic survey satisfies the agreed minimum work programme for the First Exploration Period under the Petroleum Agreement governing Block SL-4. Elixir will be required to contribute approximately US$1.5m to the cost of the 3D survey in September 2008 and at that time can elect to issue fully paid ordinary shares in Elixir to the value of approximately US$2.0m in order to exercise the option over an additional 20% interest in the project that it holds.

MINERAL ASSETS

Following the completion of the merger with Gawler Resources, Transition Resources Limited (“Transition”), a wholly owned subsidiary of Elixir, now holds a number of mineral licences located in the Northern Territory and South Australia. The directors of Elixir had investigated the opportunity to demerge Transition from the Elixir Group and for Transition to undertaking a capital raising and to seek the admission of its shares to trading on the ASX.

After discussions with a number of market participants, and cognisant of the number of IPO’s that have not proceeded or have been postponed in the past 6 months, the directors have formed the view that in light of current weakness in the Australian equity market for new mineral resource public offerings, a successful IPO of Transition would not be achievable.

5

To that end the directors have engaged the services of a corporate finance adviser to market the assets on the Company’s behalf.

FINANCIAL SUMMARY

At the end of the March 2008 quarter, Elixir held cash on hand of approximately $5.4m.

In January 2008, Elixir issued 8.57 million unsecured convertible loan notes to Macquarie Bank Limited raising $3.0 million. The loan notes have a conversion price of $0.35 and a 12 month term to expiry from the date of issue.

Options issued to former Gawler optionholders as part of the merger between Elixir and Gawler expired on 5 February 2008. These options were exercisable at $0.001 per option. At the date of expiry, the Company had received valid exercise notices from optionholders representing approximately 97% of the total options on issue. Those options that remained unexercised at the expiry date were cancelled.

Please find attached the Company’s Appendix 5B for the 3 month period to 31 March 2008.

REPORTING SCHEDULE

Elixir Petroleum’s proposed reporting schedule for the remainder of the 2008 calendar year is as follows:

Item	Expected Date
Quarterly Activities Report for Quarter ended 30 June 2008	Thursday, 31 July 2008
Full Year Financial Report	Thursday, 28 August 2008
2008 Annual Report and Notice of Meeting	Thursday, 23 October 2008
Quarterly Activities Report for Quarter ended 30 September 2008	Wednesday, 29 October 2008
2008 Annual General Meeting	Wednesday, 26 November 2008

Yours sincerely,

ELIXIR PETROLEUM LIMITED

==> picture [145 x 36] intentionally omitted <==

Andrew Ross Managing Director

Information contained in this report with respect to the High Island and Pompano Projects, was compiled by Elixir or from material provided by the project operators and reviewed by I L Lusted, BSc (Hons),SPE , who has had more than 15 years experience in the practice of petroleum engineering. Mr Lusted consents to the inclusion in this report of the information in the form and context in which it appears.

Information contained in this report with respect to the UK North Sea Projects and Block SL-4 offshore Sierra Leone, was compiled by Elixir or from material provided by the project operators and reviewed by the Elixir’s Exploration Director, Iain Knott, BSc,MSc, FGS, AAPG, who has had more than 25 years experience in the practice of geology, including more than 5 years experience in petroleum geology. Mr Knott consents to the inclusion in this report of the information in the form and context in which it appears.

6

Appendix 5B Mining exploration entity quarterly report

Rule 5.3

Appendix 5B

Mining exploration entity quarterly report

Introduced 1/7/96. Origin: Appendix 8. Amended 1/7/97, 1/7/98, 30/9/2001.

Name of entity

	Name of entity	Name of entity	Name of entity	Name of entity
	ELIXIR PETROLEUM LIMITED
	ABN 51 108 230 995 Consolidated statement of cash flows
			31 March 2008
Cash flows related to operating activities 1.1 Receipts from product sales and related debtors 1.2 Payments for (a) exploration and evaluation (b) development (c) production (d) administration 1.3 Dividends received 1.4 Interest and other items of a similar nature received 1.5 Interest and other costs of finance paid 1.6 Income taxes paid 1.7 Other – Exploration JV Reimbursement Net Operating Cash Flows			Current quarter $A’000	Year to date ( 9 months ) $A’000
			2,597 (26) (1,859) (79) (655) - - (69) - 73	2,832 (2,627) (1,859) (79) (2,949) - 106 (352) - 163
			(18)	(4,765)
Cash flows related to investing activities 1.8 Payment for purchases of: (a) prospects (b) equity investments (c) other fixed assets 1.9 Proceeds from sale of: (a) prospects (b) equity investments (c) other fixed assets 1.10 Loans to other entities 1.11 Loans repaid by other entities 1.12 Other – Cash acquired on acquisition of Gawler Net investing cash flows 1.13 Total operating and investing cash flows (carried forward)			- - - - - - (2) - -	- - (3) - 210 - (3,222) - 2,796
			(2)	(219)
			(20)	(4,984)

• See chapter 19 for defined terms.

Appendix 5B Page 1

30/9/2001

Appendix 5B Mining exploration entity quarterly report

1.13 Total operating and investing cash flows (brought forward)	(20)	(4,984)
Cash flows related to financing activities 1.14 Proceeds from issues of shares, options, etc. 1.15 Proceeds from sale of forfeited shares 1.16 Proceeds from borrowings 1.17 Repayment of borrowings 1.18 Dividends paid 1.19 Other Convertible Notes Less underwriting fee Issue Costs Net financing cash flows	1 - - - - - 3,000 - (8)	515 - 50 - - - 5,675 (134) (43)
	2,993	6,063
Net increase (decrease) in cash held 1.20 Cash at beginning of quarter/year to date 1.21 Exchange rate adjustments to item 1.20 1.22 Cash at end of quarter	2,973 2,489 (24)	1,079 4,406 (47)
	5,438	5,438

Payments to directors of the entity and associates of the directors Payments to related entities of the entity and associates of the related entities

1.23 1.24	Aggregate amount of payments to the parties included in item 1.2 Aggregate amount of loans to the parties included in item 1.10	Current quarter $A'000
		(186)
		Nil
1.25	Explanation necessaryfor an understandingof the transactions
	Payments include: Directors’ fees, salaries and office rental paid to Epicure Administration Pty Ltd, a company related to Mr Jonathan Stewart.

Non-cash financing and investing activities

2.1	Details of financing and investing transactions which have had a material effect on consolidated
	assets and liabilities but did not involve cash flows

Current quarter oil & gas sales proceeds (A$2.6m) were received net of approximately A$1.2m of development costs payable to the operator of the High Island project.

2.2	Details of outlays made by other entities to establish or increase their share in projects in which the reportingentityhas an interest
	N/A

• See chapter 19 for defined terms.

Appendix 5B Page 2

30/9/2001

Appendix 5B Mining exploration entity quarterly report

Financing facilities available

Add notes as necessary for an understanding of the position.

3.1 Loan facilities 3.2 Credit standby arrangements	Amount available $A’000	Amount used $A’000
	-	-
	-	-

Estimated cash outflows for next quarter

Estimated cash outflows for next quarter
4.1 Exploration and evaluation 4.2 Development	$A’000
	800
	1,200
Total	2,000

Reconciliation of cash

Reconciliation of cash	Reconciliation of cash
Reconciliation of cash at the end of the quarter (as		Current quarter	Previous quarter
shown in the consolidated statement of cash flows) to		$A’000	$A’000
the related items in the accounts is as follows.
5.1	Cash on hand and at bank	1,661	790
5.2	Deposits at call	3,777	1,699
5.3	Bank overdraft
		-	-
5.4	Other (provide details)
		-	-
	Total: cash at end of quarter(item 1.22)	5,438	2,489

Changes in interests in mining tenements

6.1 Interests in mining tenements relinquished, reduced or lapsed 6.2 Interests in mining tenements acquired or increased	Tenement reference	Nature of interest (note (2))	Interest at beginning of quarter	Interest at end of quarter
	None
	None

• See chapter 19 for defined terms.

Appendix 5B Page 3

30/9/2001

Appendix 5B Mining exploration entity quarterly report

Issued and quoted securities at end of current quarter

Description includes rate of interest and any redemption or conversion rights together with prices and dates.

	Total number	Number quoted	Issue price per security (see note 3) (cents)	Amount paid up per security (see note 3) (cents)
7.1 Preference+securities (description) 7.2 Changes during quarter (a) Increases through issues (b) Decreases through returns of capital,buy-backs,redemptions	-	-	-	-
	- -	- -	- -	- -
7.3 +Ordinary securities 7.4 Changes during quarter (a) Increases through issues Exercise of Gawler merger options (b) Decreases through returns of capital,buy-backs	161,117,922	161,117,922	Various	FullyPaid
	- 2,384,014 -	- - -	$0.001
7.5 +Convertible debt securities Convertible Notes 7.6 Changes during quarter (a) Increases through issues (b) Decreases through securities matured,converted
	- -	- -
7.7 Options RFC Options Ambrian Options 7.8 Issued during quarter Gawler Merger Options 7.9 Exercised during quarter Gawler Merger Options 7.10 Expired during quarter Gawler Merger Options	500,000 637,148 1,137,148	- -	Exercise price $0.90 $0.60	Expiry date 16 May 2008 16 May 2010
	-	-
	(2,384,014)	-	$0.001	5 Feb 2008
	(227,472)		$0.001	5 Feb 2008
7.11 Debentures(totals only)	-	-	-	-
7.12 Unsecured notes(totals only)	-	-	-	-

• See chapter 19 for defined terms.

Appendix 5B Page 4

30/9/2001

Appendix 5B Mining exploration entity quarterly report

Compliance statement

• 1 This statement has been prepared under accounting policies which comply with accounting standards as defined in the Corporations Act or other standards acceptable to ASX (see note 4).

• 2 This statement does / ~~does not*~~ (delete one) give a true and fair view of the matters disclosed.

Sign here: ............................................................ Date: 30 April 2008

( ~~Director/~~ Company secretary)

Print name: ALEX NEULING

• See chapter 19 for defined terms.

Appendix 5B Page 5

30/9/2001