Activity Update

Fusion Oil & Gas PLC
29 July 2003

Fusion Oil & Gas plc

                          ('Fusion' or 'the Company')


               Fusion Releases Update to 2003 Activity Profile -



Fusion is pleased to provide an update on its operational program for 2003,
including details of the imminent drilling programme in Mauritania.  In certain
instances the plans are subject to normal operational considerations and
government/joint venture approvals.



Mauritania - PSC A and PSC B



Following several meetings between the Mauritanian Joint Venture partners for
PSC A and PSC B, agreement has now been reached on the likely scope and timing
of the exploration and appraisal/development programme for 2003.  In summary,
the parties have agreed to drill two firm wells in the 2003 drilling campaign.
A third well will be proposed in PSC B following completion of studies on a
number of prospects under consideration.



The first well in the campaign will be an early development/appraisal well on
the Chinguetti discovery.  An extended production test of this well is planned
and following completion of testing it is anticipated that the well will be
suspended pending commissioning of production facilities in late 2005.  The
second well is expected to be an exploratory test of the Tiof prospect in 1,130
metres of water approximately 25 km to the north of the Chinguetii discovery.  A
number of other prospects are being considered for a further exploratory test
and a decision on whether to drill, and the preferred prospect will be made
following completion of the Chinguetti development/appraisal well.



Woodside, as Operator of the PSC B Joint Venture, has signed a letter of intent
with Smedvig Offshore AS for the drillship West Navigator to undertake drilling
operations.  Drilling of the first well is expected to commence during August.



As previously announced on 28 May 2003, the Company has entered into an
agreement with Premier Oil plc regarding its interests in Mauritania.  Subject
to fulfilment of certain conditions, Fusion will receive cash payments linked to
all future production from PSC A and PSC B in addition to cash payments on
approval of all future field development plans for additional discoveries with
reserves in excess of 50 million barrels.



The Gambia - Deepwater PPL



Following the announcement made on 17 January 2003 and the interim results
statement on 25 March 2003 on the decision to withdraw from The Gambia, Fusion
now announces the satisfactory termination of its agreement with The Republic of
The Gambia regarding a deepwater Petroleum Production License.



The parties have resolved all legal issues on agreeable terms.



AGC (Senegal/Guinea Bissau) - Dome Flore



A 380 sq km 3D seismic survey over the Dome Flore and Dome Gea oil accumulations
was acquired earlier in the year and is currently being processed.  Preliminary
processing results are encouraging and delivery of the final volume is
anticipated in September 2003.  The Dome Flore and Dome Gea accumulations are
considered to contain in excess of 500 million barrels of heavy oil-in-place in
shallow reservoirs, however the reserves are thought to be un-economic based on
development scenarios using conventional production technology at current oil
prices.  The latest 3D survey, however, is designed to image deeper reservoirs,
where previous drilling had encountered indications of better quality oil that,
if trapped in sufficient quantity, should be easier to develop.



AGC (Senegal/Guinea Bissau) - Croix du Sud



Under the terms of a farmin agreement announced on 4 September 2002 Amerada Hess
has funded the acquisition of a 1,530 sq km 3D seismic survey.  The final data
volume was received in June 2003 and evaluation is underway.  Amerada Hess will
elect whether or not to proceed with the drilling phase of the farmin deal by
October 2003.



AGC (Senegal/Guinea Bissau) - Cheval Marin



Interpretation of the 2,400 sq km 3D seismic survey acquired during 2002 is at
an advanced stage.  A number of prospective features have been high-graded for
detailed study in advance of the end of the year, when the Joint Venture will
decide whether or not to enter the second exploration period that carries a one
well drilling commitment.



Cameroon - Ntem



Under the terms of a farmin agreement announced on 4 September 2002 Amerada Hess
has funded the acquisition of a 1,550 sq km 3D seismic survey.  The final data
volume was received in July 2003 and evaluation is underway.  Amerada Hess will
elect whether or not to proceed with the drilling phase of the farmin deal by
November 2003.



Gabon - Iris Marin and Themis Marin



3D seismic surveys covering a total area of 625 sq km have recently been
acquired in the Iris and Themis Marin licenses.  The surveys have been
specifically designed to use the latest processing technology to image
reservoirs beneath complex geology involving salt that had been a barrier to
previous surveys.  Similar seismic techniques to those being employed by Fusion
have recently been applied successfully in adjacent permits in southern Gabon.
Evaluation of the preliminary data volumes is underway.  A fast-track evaluation
strategy is being employed to enable the Joint Venture to mature drilling
locations by early 2004.



Under the terms of the agreement with Premier announced on 28 May 2003 Fusion
will reduce its interest in the permits from 38.57% to 20.57% in exchange for
being carried through 18% of the cost of the first two wells in each license.
During the earning period Fusion will have a paying interest of 2.57%.





SADR - Western Sahara Technical Co-operation Agreement



The studies required under the Western Sahara Technical Co-operation Agreement
with the Saharawi Arab Democratic Republic (SADR) are near completion.  A final
report will be delivered during August 2003.  Completion of the technical
studies will enable Fusion to lodge applications for up to three exploration
licenses each of up to 20,000 sq km.



The sovereignty of the territory of Western Sahara is subject to a long-standing
dispute between the indigenous Saharawi people, represented by the Polisario,
and the Kingdom of Morocco.  The licences applied for by Fusion will be ratified
following admission of the SADR to the United Nations.



Guinea Bissau - Sinapa and Esperanca



Fusion has an option to acquire a 5% working interest in the Sinapa and
Esperanca offshore concessions operated by Premier Oil plc, at no cost to
Fusion, within 60 days of the completion of the next exploration well on each
licence. Should Fusion elect to exercise this option, the Company will pay its
pro rata share of costs from the date the option is exercised.



It is expected that Premier will drill at least one well in Guinea Bissau during
2004.



Fusion's Managing Director, Dr Alan Stein, commented:



'We are pleased to advise of continued progress across all of the Company's
projects.  The 2003 drilling programme in Mauritania has the potential to
realise significant value for the Company without any requirement for additional
funding.  Elsewhere in the portfolio, the 3D surveys currently being evaluated
should provide the basis for an exciting future drilling programme.  Subject to
various partner/Government approvals, Fusion's forward drilling programme to the
end of 2005 could now include direct and indirect involvement in potentially
more than 15 wells, with the majority of these being funded by farmout
agreements.  Following drilling activity in Mauritania during the remainder of
2003 at least one well in Guinea Bissau and two wells in Gabon are anticipated
early in 2004.'



                                                                 July 29th, 2003





For further details please refer to the company's web page www.fusionoil.com.au
or contact:




Fusion Oil & Gas plc                              Tel:   [phone]
Alan Stein, Managing Director                     Fax:   [phone]
Australia                                         e-mail:  [e-mail]


Peter Dolan, Chairman                             Tel:    [phone]
England                                           Fax:   [phone]
                                                  e-mail:  [e-mail]


College Hill Associates                           Tel:   [phone]
Justine Hibbert                                   Fax:   [phone]
Phil Wilson-Brown                                 e-mail:[e-mail]
                                                  [e-mail]





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