EMERALD RESOURCES NL — Investor Presentation 2008

Aug 11, 2008

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Emerald Oil & Gas NL

Emerging Appalachian Basin Gas Producer

Aug 2008

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Company Overview

• Perth based company, listed on ASX in June 2006 • Gas Development Project in Appalachian Basin, USA • Exploration Assets in Australia & USA • 115.48m shares on issue • 6.48m unlisted options ($0.25/$0.30; Dec 08/09)

• $ 5.4 million cash • Market cap $23.1m (undiluted @ 20 cps) • ASX code: EMR

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The New Emerald Oil & Gas

• Strategy -

• Implementation -

• Development of production and reserve / resource base via 50 well Appalachian basin drilling programme in 2008/09

• Proven undeveloped Reserve status (PUD) for undrilled .

• locations (shallow and deep) surrounding each well

• • Staged divestment of developed reserves/resources to industry participants at current high market prices.

• Continual drilling program fully funded through US subsidiary. +1000 potential wells.

• Upside through use of horizontal drilling, new frac techniques and emerging Marcellus shale play

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Appalachian Basin, USA

West Virginia Acreage

• Oldest producing basin in U . S .

• • Long-life gas reserves

• • Huge potential

• • Renewed Interest

• • Increased infill and deeper drilling and horizontal wells

• • New fracing technologies Kentucky Acreage

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P&J Resources – who are they?

• Agreement:

• Access to 45,000 acres in Eastern Kentucky, 45,000 acres in western West Virginia under 10 year agreement (AMI)

• Continuous drilling to earn 80% working interest

• Turnkey well pricing

• Each unit earned includes 4,000 foot radius spacing including several locations and surrounding Proven Undeveloped Reserves (PUD)

• Existing gathering line system owned by P&J including various compressors and two Amine plants to remove impurities.

• Access to El Paso, Jefferson and Chesapeake major regional infrastructure

• Price premium due to high BTU content and proximity to markets

• • TICO price recently US$12.00 per Mcf. (currently $9.00/Mcf)

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Spacing unit
Well
Well
• Each P & J well
earns acreage
within 4,000ft
PUD
radius spacing
unit (8,000’ dia)
•
Includes 4x
4,000ft
Well deep locations
PUD PUD plus PUDs
•
PUD’s included
in reserve
PUD
estimate
Well
Well
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EMR Infrastructure (P&J)

• 2 new amine plants installed (Ky. and W.V.)

• 4 compressors

• 2 new pipelines

• Completion Q3 08

• No cost to Emerald

• • Transmission costs approx $0.60/Mcf

• Links to major lines operated by El Paso, Colombia, Jefferson, Chesapeake, Equitable

• All gathering lines in place

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Appalachian Pipeline Infrastructure
•
Interstate Pipeline options
•
Amine plants installed
-
Kentucky
-
W. Virginia
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DTI W. Virginia Acreage Kentucky Acreage

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Drilling program & Funding

• P&J providing 2 rigs for continuous drilling program

• 5 wells on production, 2 awaiting hook up

• Emerald to commit to 50 well program

• Emerald to drill mix of

– Shallow

– Dee vertical p – Deep horizontal

– Shale (vertical & horizontal)

– Re-works • Participation Agreement signed with US investment fund AvantGarde to contribute up to US$25M to drilling • Avant-Garde to earn half of Emerald’s working interest for payment of 100% of the drilling costs.

• Other non-dilutionary funding avenues being evaluated

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Drilling Program Project Emerald Interest Emerald attributable potential resource (unrisked) Timing Appalachian Development – continuous drilling upon funding 80% Approx 0.4 Bcf per well First well (acquired) hooked up Deep well May 08 Commence ~50 well program upon funding G b h (N D k t USA) 15% B kk 0 5 MMBO W ll #1 d ill d J l 08 reen us a o a - Deep Bakken well - Shallow reef well a en– . 0.5 Bcf Reef– 0.15 MMBO e r e u y Well # 2 drilled Aug 08 EP104/R1 – (Canning Basin WA) - Stokes Bay well testing 12.75% 18 BCF 1.2 MMBO Q4 08 NW Alice (Texas USA) –drilling second well 10.0% 7 BCF 175,000 BO Q4 - 08

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Conclusion

To develop cashflow and reserves / resources in producing on-shore US Appalachian basin and establish positions in low risk onshore e x l o r at i o n assets in WA a n d t h e US p

• High potential gas development play

• Developing cashflow + resource/reserve

• Project level funding non dilutive

• Capitalising on strong commodity prices, existing infrastructure and proximity to markets

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Contacts

• Office Address:

Level 2, 16 Altona Street, West Perth WA 6005

• Phone:

• (+61 8) 9482 0510

• Fax:

(+61 8) 9482 0505

• Web:

www.emeraldoilandgas.com

• Email:

Bob Berven - Executive Director, Technical bberven@emeraldoilandgas.com

John Hannaford - Executive Director, Finance jhannaford@emeraldoilandgas.com

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Thank you

Disclaimer This presentation contains forward looking statements that are subject to risk factors associated with the oil and gas industry. It is believed that the expectation reflected in the statements are reasonable but they may be affected by a variety of variables and changes in underlying assumptions which could cause actual results or trends to differ materially to those stated, including but not limited to: product price fluctuations, currency fluctuations, drilling and production results, reserve estimates, loss of market, industry competition, environmental risks, physical risks, legislative, fiscal and regulatory developments, economic and financial market conditions, project delay or advancement, approvals and cost estimates. Investors should undertake their own analysis and obtain independent advice before investing in Emerald shares. All references to dollars, cents or $ in this presentation are to Australian currency, unless otherwise stated.

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Appendix - Existing ongoing development projects:

• Greenbush Project – North Dakota • - NW Alice Project South Texas • Stokes Bay Prospect – EP 104 • Canning Basin - EPA 4/05-6

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Greenbush Project North Dakota Location: Ward & Renville Counties North Dakota Objectives: Bakken Shale (fractured) at 6000 feet Well depth: 6200+ FT (MISS) 9000+ FT (DEV) Emerald interest: Earned 15% WI Royalties: 20.00% (approx +9,000 acres under lease) – Hydrocarbon Potential: Bakken 63 MMBO (OOIP), 4.5MMBO + 6

20.00% (approx +9,000 acres under lease) – Bakken 63 MMBO (OOIP), 4.5MMBO + 6 BCF gas recoverable

Timing:

3-D Seismic interpreted;

– 2[nd] well July 2008 - Cored & tested Bakken – – 3[rd] well Aug 2008 Cored & tested Bakken

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Greenbush Project, North Dakota

• A fractured Bakken shale play exists caused by intersection of two major fault trends within a portion of the acreage block.

• Regional exploration targeting horizontal development of Bakken oil potential.

• Two wells drilled in Q3 2008 discovered Bakken, cores taken, waiting Operator recommendation

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NW Alice Project, South Texas

• Jim Wells County, South Texas

• Objectives: Yegua Sands

• Emerald interest: 10% WI in project

• • Royalties: 23% NRI: 77%

• Reserve potential: - 100 Bcf gas, 2.5 million bbls condensate

• Operator: Noble Energy

• • First well drilled March 07, discovered >50 feet of gas in two intervals, technical issues hampered completion and flow testing. Well suspended. 3-D seismic completed, interpretation underway.

• Follow up well anticipated in Q4 2008.

• Possible sidetrack and recompletion of RJ Hunter #1 well

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NW Alice Project area
showing location of RJ
Hunter #1 well offsetting the
Delta-Gulf 1954 well. Large
anticline structure under
lease with potential for
several well locations
following 3D seismic
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RJ Hunter #1 well location

Delta-Gulf well drill in 1954

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EP104 - Stokes Bay Prospect

• Location: EP104, Canning Basin, WA

• Objectives: All sands within Anderson formation / Nullara Carbonates

• Emerald interest: 12.75% WI Royalties: 10% Government

• Hydrocarbon potential:

Top Deltaic member: Unit ‘A' Sand: Unit ‘B’ Sand: Unit ‘C’ Sand:

4.3 Mmbo 33.5 Bcf gas 6.0 Mmbo 47.4 Bcf gas

• Operator: ARC Energy

• Valentine 1 – Drilled Sept 07 - dry hole

• Stokes Bay 1 - Drilled Oct 07 – Testing Reefal Nullara Carbonates, scheduled for Q4 2008.

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Canning Basin - EPA 4/05-6

• Location: EPA 4/05-6, Canning Basin, WA

• Objectives: All sands within Anderson formation / Nullara Carbonates

• Emerald interest: 100%

• Royalties: 10% Government, 2% other

• • Hydrocarbon potential (Eve Rose Prospect): Top Deltaic member: Unit ‘A’ Sand: Unit ‘B’ Sand: Unit ‘C’ Sand:

20 Mmbo

200 Bcf gas 25 Mmbo 250 Bcf gas

• Canning Basin: EP6/07-8 , IT07-8 and application for W07-12

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Canning Basin acreage

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