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EMERALD RESOURCES NL Capital/Financing Update 2007

Sep 24, 2007

64849_rns_2007-09-24_7523fa8e-aa16-4c3b-9438-c3027604edf6.pdf

Capital/Financing Update

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ASX RELEASE

Release Date: 25 September 2007 To: Australian Stock Exchange Ltd No of Pages: 3 From: Eric Streitberg Re: Valentine-1 Update

Please find attached an update on the Valentine-1 exploration well.

The attached release will also be available on the Company’s website at; www.arcenergy.com.au.

For inquiries please contact:

Eric Streitberg, Managing Director Telephone +61 8 9480 1300 Freecall 1800 337 330 Email [email protected]

About ARC Energy Limited

ARC Energy is one of Australia’s pre-eminent energy companies, owning and operating oil and gas interests in the Perth, Canning and Bass basins, and internationally. Listed on the Australian Stock Exchange with a market capitalisation of approximately A$450 million, ARC has an aggressive onshore and offshore exploration and development drilling program. It continues to drive increased shareholder value by the early adoption of innovative technical and commercial practices.

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Level 4, 679 Murray Street, West Perth, Perth Western Australia 6005 Freecall: 1800 337 330 Tel: 61 8 9480 1300 Fax: 61 8 9480 1388

Website: www.arcenergy.com.au, Email: [email protected], ASX Code: ARQ

VALENTINE-1 DRILLING REPORT CANNING BASIN, WESTERN AUSTRALIA

Date: 25 September 2007 25 September 2007
Permit: R1
Well Location: Lat : 17o08’ 23.46”S
Long : 123o42’ 32.40”E
Directional offset to target: 0 metres
Elevation: Ground Level is 12.4mAMSL
Rotary Table is 18.1mAMSL
Prognosed Depths
(measured KB):
Top primary objective Total depth
3,222 metres 3,407 metres
Prognosed drilling time: 25 days
Spud Date: 1230 hrs, WST 12 August 2007
Present Depth at 0900 hrs: 3430mMD
Time of Reporting: 0900 hrs, WST 25 September 2007
Operations Since Last
Report:
Repaired the top drive hydraulic unit and directionally drilled
from 3,377m to 3430mMD.
Final TD has been called at 3430m MD based on lack of
porosity in cuttings and the lack of significant hydrocarbon
shows in the Virgin Hills Formation section.
Current Operations: Performing a wiper trip prior to logging.
Hydrocarbon indications: None in the section just drilled.
Comment: The clastic sediments of the target Virgin Hills Formation are
interpreted to have been intersected with lithologies being
predominantly tight sandstones and calcareous claystones.
No significant indications of hydrocarbons or porosity were
noted over this interval. Further evaluation of all intervals in
this well will be undertaken with the planned wireline logging
program.
Following the logging program, the well will be plugged back
and sidetracked to the Stokes Bay targets. In Valentine-1
the very strong gas shows and indications of porosity in the
shallower intervals of the Anderson and Laurel Formations is
considered highly encouraging for the targets of the Stokes
Bay 1 well which were encountered as planned, substantially
down-dipin the Valentine well bore.

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Participants in the well
(post earning):
Empire Oil and Gas NL - 14.8%
ARC Energy Limited - 38.95% (Operator)
Emerald Oil & Gas NL - 12.75%
Pancontinental Oil & Gas NL - 10.0%
Phoenix Resources PLC - 10.0%
First Australian Resources Limited - 8.0%
Indigo Oil PtyLtd - 5.5%

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