EMERALD RESOURCES NL — Capital/Financing Update 2008

Jul 7, 2008

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Level 2, 16 Altona Street West Perth WA 6005 Ph: +618 9482 0500 Fx: +618 9482 0505 Email: info@emeraldoilandgas.com www.emeraldoilandgas.com

8 July 2008

Centralised Company Announcements Platform Australian Stock Exchange 10[th] floor, 20 Bond Street Sydney NSW 2000

US PROJECTS DRILLING UPDATE

Emerald Oil & Gas NL (“Emerald”) is pleased to present an update on drilling operations in the US.

APPALACHIAN BASIN GAS DEVELOPMENT PROJECT

(Emerald 80% Working interest, Operator: P&J Resources Inc.)

Myrtle Crum #4 well, Wayne County, West Virginia

Drilling report as at 4.00pm US time, July 7, 2008.

Current Activity:

Current depth 1,700 feet. 9 5/8 inch casing has been set at 1,500 feet. Put blow out preventor on well head. Various mechanical repairs to the rig in the last week have now been completed. Drilling ahead.

Future Plans:

Drilling ahead to primary objective Big Six sandstone towards total depth of 5,500 feet. Targets should be reached in 5 – 6 days.

GREENBUSH PROJECT, WARD & RENVILLE COUNTIES, NORTH DAKOTA (Emerald 15% Working interest, Operator: Golden Eye Resources Inc.)

Drilling report as at 8.00am US time, July 7, 2008.

Current Activity: Current depth 7,993 feet as at 8.00am July 7, US time, drilling ahead in Souris River formation.

Future Plans:

Drilling ahead to primary objective Winnipegosis pinnacle reef at approximately 8,400 feet. Target should be reached in approximately 2 - 4 days.

The operator has advised that due to high competition for acreage and current leasing activities for the Bakken shale play, well result information is being held confidential on a “tight hole” basis. Emerald will release information as soon as it is able to as authorised by the Operator. Both Emerald and the Operator are encouraged by drilling activities to date.

Emerald Interest: Emerald has a 15% working interest in this prospect.

For more information please contact:

Emerald Oil & Gas NL

Tel: +618 9482 0510

JOHN HANNAFORD Executive Director – Finance jhannaford@emeraldoilandgas.com

BOB BERVEN Executive Director – Technical bberven@emeraldoilandgas.com

About the Appalachian Gas Development Project

Emerald announced on April 30, 2008 that it had entered into a Drilling and Operating Agreement to develop two 45,000 acre lease areas in eastern Kentucky and western West Virginia. Under the agreement Emerald will earn an 80% working interest in a 4000 foot radius spacing unit for each well drilled for 100% of the drilling costs of each well. Both acreage areas have significant potential for infill drilling on 40 acre spacing, as well as several productive horizons.

The Appalachian Valley is USA’s oldest oil and gas producing area. Recent discoveries in the Marcellus Shale have now focused renewed exploration activity on the region. Combined with high gas prices, extensive infrastructure, enhanced drilling and completion techniques the area now offers extensive upside potential and compelling economics.

About the Greenbush Project

Drilling activity in the Bakken Shale has recently significantly increased in North Dakota. On April 10, 2008 the United Sates Geological Survey (USGS) released a report estimating that recoverable oil “resources” from the Bakken within the USA portion of the Williston Basin could reach 3.65 billion barrels.

The significance of the above mentioned “deep” test on the Greenbush acreage is that it will evaluate the fractured, oil-bearing Bakken Shale which overlies the Devonian pinnacle reef. The Bakken is a prolific oil producer to the south and west in North Dakota and Montana and to the North in Saskatchewan, Canada. Recent lease acquisition activity and horizontal well drilling indicates that the Bakken oil play is moving eastwards towards Greenbush Prospect.

Emerald and Partners currently control some 8700+ acres at Greenbush Prospect. This represents some seven (7) 1280 acre spacing units under the above Bakken development scenario presented by Hess Corp for horizontal wells. The potential recoverable resource numbers within the Bakken at Greenbush has been estimated at 4.5+million barrels of oil and 5.5+Bcf gas. These are very significant potential resource numbers given the current record prices for both oil and gas in the USA. The key geological parameters to encountering “Fractured Bakken” is proximity to major structures such as faults, folds, drape over basement or reefal highs, differential compaction, etc. The Greenbush Prospect has a number of favourable structural elements that could help increase Bakken productivity due to enhanced fracturing. They can be better defined by the 3-D seismic data which was acquired over the Greenbush block some twelve months ago.

About Emerald Oil & Gas NL

Emerald Oil & Gas NL (ASX: EMR), listed on the ASX in June 2006, is an oil and gas exploration and production company with project interests in Kentucky, West Virginia, North Dakota and Texas in the USA and in the Canning Basin of Western Australia. Emerald’s focus is on both conventional and non-conventional reservoir targets for oil and gas prospects. Its primary objective is to achieve near term production and cashflow to build shareholder value and provide funds to fuel further growth. Emerald’s strategy is to take modest but meaningful positions in low risk exploration projects that can be swiftly brought into production.

Information in this announcement pertaining to exploration potential was compiled by Robert Berven, Emerald Oil & Gas NL’s Technical Director who is a Member of the Australasian Institute of Mining and Metallurgy and the American Association of Petroleum Geologists CPG # 2498.

Statements regarding Emerald’s plans with respect to its petroleum properties are forwardlooking statements. There can be no assurance that Emerald’s plans for development of its petroleum properties will proceed as currently expected. There can be no assurance that Emerald will be able to confirm the presence of additional petroleum deposits, that any discovery will prove to be economic or that an oil or gas field will successfully be developed on any of Emerald’s petroleum properties.