Farmout Negotiations

Fusion Oil & Gas PLC
23 May 2002


                              Fusion Oil & Gas plc

                          ('Fusion' or 'the Company')

                              Farmout Negotiations

Fusion is an international oil and gas exploration company, with extensive
interests in deepwater West Africa, comprising 8 licenses across 6 countries.

Fusion announces that its operating subsidiary, Fusion Oil & Gas NL, has signed
an exclusive Letter of Intent with various subsidiaries of Amerada Hess
Corporation ('Hess') whereby, subject to legal verification, completion of
mutually acceptable documentation and agreement of the respective Government
Ministries, Hess will acquire interests in Fusion's Gambia PPL, Croix du Sud
(AGC - the Senegal and Guinea Bissau joint authority which administers the
shared maritime border zone) and Ntem (Cameroon) deepwater exploration licences.

The transaction is expected to be finalized within 60 days however both parties
have decided to proceed imminently with the issuing of tender documents in
relation to the acquisition of 3D seismic surveys in each of the licences.
Accordingly Fusion has elected to make a preliminary announcement to enable
contractual arrangements in relation to the 3D seismic to be completed in
anticipation of commencing acquisition as soon as possible after final
agreements are reached.

It is envisaged in the Letter of Intent that Fusion will retain a 20% interest
in each licence and will be fully carried through an exploration program, the
details of which will be released after final agreements are reached.

Alan Stein, Managing Director of Fusion, commented:


'We are delighted to have an opportunity to establish a strategic alliance with
Amerada Hess.  In Equatorial Guinea, Hess brought the Ceiba Field on-stream in
14 months and since, has made five successive new oilfield discoveries.
Accordingly we believe that Hess will bring significant technical experience  to
the joint ventures in The Gambia, AGC and Cameroon.'

23 May 2002



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]

Peter Rigby                                 Fax:   [phone]

James Henderson                             e-mail:  [e-mail]



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