ROC to buy China Assets

Roc Oil Company Limited
27 June 2006



27 June 2006

                         ROC OIL COMPANY LIMITED ('ROC')
                             STOCK EXCHANGE RELEASE

                        ROC TO BUY APACHE'S CHINA ASSETS

1. SUMMARY

ROC has agreed to acquire a 24.5% operated interest in the Zhao Dong Block ('the
Block') in the Bohai Bay, offshore China, for a cash consideration of US$260
million/A$354 million. The acquisition is via the purchase of 100% of the shares
of Apache China Corporation LDC ('ACC') a wholly owned subsidiary of the US$20
billion/A$27 billion Apache Corporation ('Apache'), headquartered in Houston.

The Block is part of a prolific producing petroleum province which offers
considerable upside potential. Gross production from the two producing fields in
the Block is in the order of 30,000 barrels of oil per day ('BOPD') (net ACC
working interest: 7,300 BOPD) and gross proved and probable remaining reserves
are approximately 61 MMBO (net ACC working interest: 15 MMBO).

2. RATIONALE

Subject to completion, the acquisition will deliver a number of technical,
commercial and strategic benefits which will have a very positive impact on ROC.
Specifically:

• Net proved and probable oil reserves will double from 15 MMBO to 30 MMBO.

• Production will increase by more than 150% from about 4,500 BOPD to about 
12,000 BOPD. Exposure to very significant upside potential has already been 
identified and/or inferred, in the form of more or less continuous appraisal, 
development and close-in exploration drilling opportunities through to 2011 and
beyond.

• Production diversification whereby during 2H 2006, ROC will be producing oil 
from four fields, three of which it will operate, in three different countries. 
By 2Q 2007, when ROC's two non-operated oilfields in the North Sea will have 
come on stream, the Company will have oil production from six fields in four 
countries.

• ROC's operating profile will be significantly increased. The Company will be 
operating approximately 40,000 BOPD gross joint venture production offshore 
Australia and China. The Company will also be operating an additional oilfield 
development and a separate oilfield appraisal programme, both offshore China and
its other exploration operations elsewhere in the world.  In an operated gross 
production sense, ROC will be the third largest foreign operator in China.

3. FUNDING

ROC will finance the purchase via a 12 month loan provided by the Commonwealth
Bank of Australia ('CBA'). At CBA's request, an independent engineering review
of the assets was undertaken by Australian-based RISC Pty Ltd.

Subsequent to completion, ROC, which is currently debt free, will have a Debt to
Total Assets ratio in the order of 0.5 and a Debt to current Market
Capitalisation ratio in the order of 0.4.

ROC expects to put a suitable oil price hedging arrangement in place that will
reflect the magnitude of the transaction as well as the need to protect the
downside oil price risk while at the same time retaining an appropriate amount
of exposure to the oil price upside.

4. TIMING

The transaction has an effective date of 1 July 2006 and is expected to close in
2H 2006, after satisfaction of a number of conditions precedent, which reflect
normal government and industry practices.

5. ASSETS

The Block, which covers 27.5 sq kms, is located in very shallow water close to
shore in the Bohai Bay, offshore China, approximately 200 km southeast of
Beijing (Attachment 1).

Within the Block there are two producing oil fields (C and D) and part of a
third field (C4) which is due to be developed in 2007 and come on to production
in 2008. ACC operates the planned C4 development in which it has an 11.575%
unitised interest.

Since production commenced in 2003, towards 20 MMBO has been produced from the C
and D fields and there is an estimated 61 MMBO of gross proved and probable
reserves yet to be produced. Production, which is currently through 26 wells,
will be augmented by a multi-well drilling programme, targeting appraisal,
development, extended reach and close-in exploration opportunities, which is
underway and expected to continue over the next several years. Operating,
development and drilling costs are reasonable, partly because of the facilities'
proximity to shore and the size and established nature of the operation which
provides economies of scale.

The offshore facilities comprise two, bridge-linked platforms, one of which is
dedicated to drilling and accommodation while the other is used for production
and processing. An integral part of the oil production operation is the
simultaneous production of a significant amount of associated water which is
reinjected into the reservoir. The facilities have been designed accordingly,
with 12 water injectors and four water source wells supporting the current oil
production.

An indication of the quality of the petroleum system is provided by the fact
that, within the Block, 27 different stratigraphic levels, ranging in age from
Palaeozoic to Tertiary, are known to contain oil. Sixteen of these stratigraphic
intervals are currently productive. Between 1994 and first production, 11
exploration wells were drilled in the Block of which eight (73%) encountered
significant oil.

Reservoir quality is good to excellent, particularly in the shallower parts of
the section where permeabilities are measured in Darcys and porosities range
above 30%. The source rock is rich and generative. Oil gravities range from
18degrees to 38degrees API with the higher gravity (lighter) oil being in the
deeper part of the section. The oil, which is waxy with a low pour point and a
low acid content is currently sold into the export market. Zhao Dong oil bears
comparison with Indonesian Duri crude which recently traded at a discount of
approximately US$5.50/bbl to West Texas Intermediate.

The Block is administered under the terms of a standard Petroleum Sharing
Contract the other parties to which are PetroChina Company Limited (51%) and New
XCL-China, LLC (24.5%).

6. CEO'S COMMENTS

Commenting on the transaction, ROC's CEO Dr John Doran stated that:

'When completed, the acquisition, which ROC first identified in 2001, will have
a profound effect on the Company.

The transaction is a great example of the efficiency of the industry food chain.
For Apache, with its US$20 billion market capitalisation and two billion barrels
of proved reserves, the asset may have become less material. For ROC, a much
smaller company, the transaction will provide a substantial boost to its reserve
and production trajectory.

For ROC, this is also the next logical growth step. Quite apart from the
fundamental quality and upside promise of the assets, the deal delivers a number
of other benefits ranging from reserve and production growth in a designated
core area to increased technical and operating mass.

Apache has been an outstanding operator of the Zhao Dong Block and ROC will be
looking to deliver more of the same by retaining the existing operating
structure. The acquisition will complement ROC's other operations at the Cliff
Head Oil Field Development, offshore Western Australia, which is just being
completed, and in the Beibu Gulf, offshore China, where ROC has just started an
aggressive appraisal programme relating to its recent oil discovery. With this
operating capacity being an important component of the transaction, the timing
of the Zhao Dong deal could hardly have been better.

Placing the acquisition in an Australian industry context is an interesting
exercise. Market-watchers in Australia are increasingly talking about a
potential consolidation of the independent oil and gas sector. However, if you
were to rummage through corporate Australia you would find it very difficult to
acquire the same amount of proved and probable oil reserves for the same price.
Then, if you added the requirement that those reserves must come complete with
the upside potential that an exceptionally well endowed petroleum system
provides, the task would move from being very difficult to totally impossible.
This broader access to global opportunities is one of the benefits which ROC
shareholders derive from the Company's long established focus on international
oil and gas operations.

Since 1998, ROC has enjoyed working with various Chinese oil companies and in
this context it looks forward to expanding these relationships by working with
PetroChina, the largest interest holder in the Zhao Dong Block.'


*For a complete copy of this release and attachment, please see ROC's website.
(http://www.rocoil.com.au/Public/Announcement/2006/ROC_to_Buy_Apaches_China_Assets_27.06.06.aspx)


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In accordance with new Alternative Investment Market of the London Stock
Exchange rules the information in this report has been reviewed by an
appropriately qualified person with more than 5 years relevant industry
experience, specifically, ROC's Senior Reservoir Engineer Mr M Lucas, B.Sc.
(Hons), M.Sc., MBA and member of the Society of Petroleum Engineers.
--------------------------------------------------------------------------------

Michelle Manook                          For further information please contact:
General Manager - Corporate Affairs                             Dr John Doran on
                                                            Tel: [phone]
                                                            Fax: [phone]
                                                     Email: [e-mail]
                                       Or visit ROC's website: www.rocoil.com.au

                                                                   Dr Kevin Hird
                                            General Manager Business Development
                                                       Tel:  [phone]
                                                       Fax:  [phone]
                                                     Email:  [e-mail]
 
                                                                    Nick Lambert
                                            Bell Pottinger Corporate & Financial
                                                       Tel:  [phone]



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