TALIUS GROUP LIMITED — Capital/Financing Update 2006

Dec 6, 2006

www.advanceenecovitd.com.au Suite 4, 16 Ord Street 1 tel: 08 9486 1122 West Perth, Australia | fax: 08 9486 1011 PO Box 1779, ACN 111 823 762 West Perth 6872

ASX Announcement 7 December 2006

Palo Pinto PK1 Settlement

Advance Energy Limited is pleased to announce closure on the acquisition of the PK1 property in Palo Pinto county, Texas. Further details of the final settlement transaction and funding are provided in the attached schedule.

Monthly revenue post the acquisition of the PK1 property is expected to increase from the current level of US\$483,000* to US\$774,000* once the development program has been completed. The work program on the PK1 property is expected to reach completion by the end of the third quarter of 2007. This acquisition, together with the work program on existing properties is expected to raise total revenues, as previously announced, to approximately US\$1,900,000* per month by the end of 2007.

The company is currently developing a detailed drilling and workover program on the PK1 property, the details of which will be released to the market once finalised.

For further information contact: Mr Lance Camacho Company Secretary Telephone: 08 9486 1122 Facsimile: 08 9486 1011

$*(at $7.00 per mefe)$

Advance Energy Limited is focused on the acquisition and development of oil and gas producing assets in Texas USA. The company aims to acquire assets with a combination of debt and equity that have current production and cash flow and to enhance production and cash flow through the further development of these assets. Once a property has reached its full productive potential and/or has achieved economic payout to Advance Energy, the Company would look to on sell all or part of its interest. It is the aim of the Company to develop a portfolio of assets which will be developed and traded to maximize returns on funds invested.

Summary of PK1 Settlement.

US\$

Purchase price to seller	(Note 1 to 3)	9,668,782
Transaction costs		270,751

• Note 1) Part of the transaction was financed though a short term funding facility of AUD1,000,000 provided by a private investor. The agreement included the issue of 3 million options with a strike price of 60c per share for 3 years, which are to be issued after the general meeting scheduled to be held on the 15 December 2006. There were no further fees in respect of the facility.
• Note 3) Bardev Pty Ltd has exercised 1,000,000 escrowed options providing AUD250,000 to the company. In consideration for the early exercise of these options Advanced Energy will issue a further 1,000,000 options exercisable at 60 cents on similar terms.
• Note 2) On 24 November a convertible note was issued for AUD750,000.