REG-Oilex Ltd: Operations Report - India

.
22 July 2008

SUBJECT: OPERATIONS REPORT - INDIA

Oilex advises that drilling and testing operations are in progress at 2
locations in the Cambay Field, Cambay Basin, Gujarat, India. Preparations are
being made to conduct drillstem tests (DST's) at Cambay-19Z and rigging up
operations in preparation for spud of the well are in train at Cambay-73
(renamed from Cambay-34Z) location. The following table gives a summary of
current and planned operations.

CAMBAY-19Z APPRAISAL WELL

Objectives: Primary: Oligocene OS II - gas

Eocene EP III and EP IV - oil

Secondary: Basal EP IV - oil

Miocene Basal Sandstone - gas

Deccan Fractured Basement - oil

Status: The drilling rig has demobilized from location after suspending
the well on completion of DST #1. Site preparation for the
introduction of a smaller, cost-effective workover rig to conduct
DST's #2 (Basal EP IV sandstone), #3 (EP III and EP IV) and #4
(OS II) is under way. The workover rig has been contracted and is
expected to be on site within the next two weeks.

Operations: DST #2 will be carried out over an interval of 16 metres of
potential oil pay below the zone that was tested by DST #1.

DST #3 will be conducted over an interval of about 23 metres at
the EP III and EP IV where good gas shows were recorded while
drilling and the zone is expected to flow oil by analogy with
other wells on the Western High Block of Cambay Field.

DST #4 will be conducted at the shallower level of the OS II
reservoir unit depending on the results of the DST's at the
deeper levels. Strong gas shows were recorded at the OS II level
while drilling. In the event that the well is retained as an oil
producer, the OS II will not be tested in this well.

Results: DST #1 successfully flowed oil to surface at a rate of over 800
barrels of oil per day (BOPD) for the first hour of the test and
later stabilised at a rate of 120 BOPD on 1" choke during the
final phase of the 32 hour flow period. No formation water has
been produced with the oil which is 410- 430 API gravity.

The Basal EP IV zone is present in at least three old wells on
the Western High Block. These old wells were either not tested or
were poorly evaluated and appear to have a similar log response
to the zone that was successfully tested in Cambay-19Z.
Preliminary indications from seismic and the analogous well logs
are that the Basal EP IV may extend across the Western High
Block.

CAMBAY-73 APPRAISAL WELL

Objectives: Primary: Oligocene OS II - gas

Eocene EP III and EP IV - oil

Basal EP IV - oil

Secondary: Miocene Basal Sandstone - gas

Deccan Fractured Basement - oil

Status: The drilling rig has arrived on location at Cambay-73 and is
rigging up in preparation for spud of the well. The location is
the first of a series of new locations that do not involve
drilling from existing old well locations and the well will be
drilled vertically rather than as a directional hole as was the
case for Cambay-23Z and Cambay-19Z thereby reducing the time and
cost taken to reach to Total Depth (TD).

Comments: The location of Cambay-73 has been selected to drill the OS II
and EP III-IV primary objectives on the eastern side of the fault
that separates the Western High Block from the Basin Gas Area. It
is anticipated that both zones will be gas nearing in this well.

The well is also designed to intersect the Basal EP IV oil zone
on the Western High Block at a favourable location.

Figure 1. Cambay-73 Schematic Well Bore Section - see full report on Oilex
website

Figure 2. Cambay Field Appraisal Well Locations at main target horizons- see
full report on Oilex website

Participants in the Cambay Production Sharing Contract are:

Joint Venture Party Participating Interest

Oilex Ltd (Operator) 30%

Oilex NL Holdings (India) Limited (100% owned by Oilex 15%
Ltd)

Gujarat State Petroleum Corporation 55%

A glossary of terms used in the oil and gas industry and useful links to other
glossaries can be found at http://www.spe.org/spe-app/spe/industry/reference/
glossary.htmhttp://www.spe.org/spe-app/spe/industry/reference/glossary.htm, the
website of the Society of Petroleum Engineers.

Yours sincerely,

B. H. McCarthy

Managing Director

For further information, please contact:

Ray Barnes, Technical Director, Oilex Ltd Tel. +61 8 9485 3200 (Western
Australia)

Archie Berens, Director Pelham Public Relations Tel. +44 20 7743 6679 (United
Kingdom)

RFC Corporate Finance Ltd acts as Oilex's Nominated Adviser, contact Stuart
Laing +618 9480 2506

The information in this report has been compiled by the Managing Director of
Oilex Ltd, Bruce McCarthy B.Sc. Hons. PhD (Geology) who has over 29years
experience in petroleum geology and Ray Barnes, B.Sc. Hons. the Technical
Director of Oilex Ltd who has over 35 years experience in petroleum geology and
is a member of the AAPG & EAGE. Estimates ofoil-in-place arereported in
accordance with the standard definitions set out by the Society of Petroleum
Engineers, further information on which is available at www.spe.org.

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