EMERALD RESOURCES NL — Capital/Financing Update 2009

May 19, 2009

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Level 2, 16 Altona Street West Perth WA 6005 Ph: +618 9482 0510 Fax: +618 9482 0505 Email: info@emeraldoilandgas.com www.emeraldoilandgas.com

20 May 2009

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

AGREEMENT TO ACQUIRE ADDITIONAL NW ALICE INTEREST

Highlights:

• Emerald has reached agreement to increase its working interest in NW Alice project in Texas to 14% (previously 10%);

• Discovery well drilled in March 2007 intersected two productive gas zones in Yegua sands;

• 3P reserves of 10.2 Bcf of gas and 86,600 BBL oil for Emerald’s 14%;

• Awaiting Operator’s proposal for follow up well in Q3, 2009 based on 3D seismic interpretation.

NW Alice Project, Jim Wells County, Texas USA (Emerald WI 14%; Operator Noble Energy)

Emerald Oil and Gas (“Emerald” or “the Company”) is pleased to announce that it has reached agreement for the acquisition of an additional 4% working interest in the NW Alice Joint Venture, increasing Emerald’s working interest to 14%. The NW Alice Joint Venture includes the R.J. Hunter #1 gas discovery well drilled on a large anticline structure in 2007 in Jim Wells County, Texas USA. Emerald is currently awaiting confirmation from the Operator, Noble Energy, regarding plans to drill a second well in Quarter 3, 2009. This well is intended to prove an extension to the gas bearing structure penetrated by R.J Hunter #1.

The NW Alice Joint Venture currently holds 2500 net acres of oil and gas leases in an Area of Mutual Interest (AMI) covering 7590 acres (12 square miles) in Jim Wells County, Texas.

The R.J. Hunter #1 well was drilled in March 2007, encountering approximately 50 feet of net gas/condensate bearing sands, predominantly in two zones in the lower and middle Yegua sands. Unfortunately, the lower sand could not be tested due to casing collapse when the well was initially perforated. The middle sand produced gas and some as yet unexplained fresh water after perforation and fracture treatment. The well was left suspended.

Subsequently, Noble Energy (Operator) acquired, processed and interpreted a 3D seismic survey over the large (100 Bcf) anticline structure penetrated by the

discovery well and is currently acquiring additional acreage on behalf of the Joint Venture based on this.

Despite well problems with the initial completion, independent reserves estimates indicate Emerald’s (14%WI) current 3P reserves based on R.J. Hunter # 1 well results are:

		Undeveloped
	Proved	Probable	Possible	Total
Middle Yegua –
Y15
Gas (MMcf)	237	409	1,725	2,370
Condensate (Bbls)	5,929	10,349	40,964	57,242
Lower Yegua –
Y21*
Gas (MMcf)	0	0	7,869	7,869
Condensate (Bbls)	0	0	129,360	129,360

* Lower Yegua not flowed due to mechanical problems in well, therefore Proved and Probable reserves not attributed at this stage.

Consideration for the acquisition of the additional 4% interest is a total of US$125,000. Emerald anticipates closing the acquisition within a week.

Appalachian Gas Development Project, Kentucky & West Virginia, USA (Emerald 80% WI; Operator P&J Resources Inc.)

Emerald’s program to re-complete 8 gas wells in Magoffin County, Kentucky is proceeding slowly due to extremely wet weather through April and the first half of May making site access difficult or impossible in some cases. Currently 3 wells are producing and all 8 wells are expected to be on production by midyear, depending on local conditions.

For more information please contact:

Emerald Oil & Gas NL Tel: +618 9482 0510

MIKE KRZUSChief Executive Officermkrzus@emeraldoilandgas.com	JOHN HANNAFORDExecutive Director – Financejhannaford@emeraldoilandgas.com

Information in this report pertaining to reserve estimates for the NW Alice project was compiled by Allen Kelley of Ralph Davis Associates Inc. who has consented to the inclusion of that information in the form and context in which it appears.

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 extensive infrastructure, enhanced drilling and completion techniques the area now offers extensive upside potential and sound economics.

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.

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.