PSC Transfer Approval

1 Aug 2006 08:15

Fortune Oil PLC01 August 2006 1 AUGUST 2006 FORTUNE OIL PLC ("Fortune Oil" or the "Company") The Company is pleased to announce that the Ministry of Commerce has approvedthe transfer of the foreign contractor rights in the Liulin block ProductionSharing Contract ("PSC") for coal bed methane ("CBM") to Fortune Liulin GasCompany Limited and the PSC exploration period has been extended for a furthertwo years. Fortune Liulin Gas Company Limited is to be owned 60 per cent by Fortune Oil and40 per cent by Molopo Australia Limited. All central government approvals arenow in place for Fortune Oil to begin a drilling programme so as tocommercialise the gas reserves in the Liulin block. The expenditure commitmentfor the Company over the next year is US$2.5 million which will be funded fromexisting cash resources. The Liulin block is one of the best geologically proven CBM blocks in China witha potential plateau production of 0.5 billion cubic metres per year. FortuneOil is building a professional CBM team and actively seeking other CBMopportunities in China. This is an important and exciting step in the Company's path to becoming aleading independent integrated gas company in China; and development of such CBMresources will have significant safety, environmental and economic benefits forChina. Enquiries: Fortune Oil PLCJohn Pexton - Deputy Chief Executive Tel: 00 852 2583 3113 (Hong Kong) Pelham Public RelationsArchie Berens Tel: 07802 442 486Kate Catchpole Tel: 020 7743 6678 This information is provided by RNS The company news service from the London Stock Exchange