Investment Update

Xtract Energy plc
19 October 2007

19 October 2007                                                        AIM: XTR

                               XTRACT ENERGY PLC
                          ('Xtract' or the 'Company')

                         PROJECT UPDATE - MEO AUSTRALIA

Xtract is pleased to refer shareholders to the following press release announced
in Australia today by MEO Australia Limited (MEO). Xtract currently holds
approximately 21.3% of the issued capital of MEO.

                             ASX AND MEDIA RELEASE
                      HERON-2 WELL WEEKLY DRILLING REPORT

Key Points:

• Drilled 36 inch hole and 30 inch casing set to 108m

• Final rig commissioning, testing and minor repairs completed

• At 06.00 am commenced drilling the 26 inch hole

MELBOURNE, AUSTRALIA (October 19, 2007) -- MEO Australia Limited (ASX: MEO)
submits this drilling report for the period ending 0900 hours, October 19, 2007.
The Heron-2 well was spudded at 2230 hours (ACST) on October 12, 2007 in
Exploration Permit, NT/P68.

As a new rig, MEO allowed for an approximate 5 day period for final rig
commissioning, equipment testing and minor repairs to ensure all critical 
equipment was fully operational prior to drilling out of the 30 inch conductor. 
At 6 am this morning, the rig commenced drilling the 26 inch hole.


The participants in the well are:

TSP Arafura Petroleum Pty Ltd                                               45%
(MEO subsidiary)

Oz-Exoil Pty Ltd (MEO subsidiary)                                           45%

Petrofac Energy Developments Oceania Ltd (Petrofac Limited subsidiary)      10%


Heron-2 is being drilled by Seadrill's West Atlas jack-up rig contracted to MEO
for two firm wells and one option well.

The Heron-2 well is designed as a vertical well to penetrate and production test
the Epenarra Darwin Formation and the deeper Elang/Plover Formation of the 
Heron North structure. The planned total depth of the well is approximately 
4300m below sea level.


The Heron-1 well drilled by ARCO in 1972 intersected a 52m gas bearing column in
the Darwin Formation (a fractured carbonate reservoir) within the 1,200 square
km mapped closure of the large Epenarra structure. Heron-1 also reached a gas
charged zone in the deeper underlying Elang/Plover horizon, which is a 
secondary objective for the Heron-2 well.

Further information on MEO can be found at www.meoaustralia.com.au


Enquiries please contact:

Xtract Energy plc              Andy Morrison, CEO      [phone]

Smith & Williamson Corporate
Finance Limited                David Jones             [phone]
                               Azhic Basirov

Scott Harris                   Stephen Scott           [phone]
                               Annabel Michie

For further Information on Xtract please visit www.xtractenergy.co.uk

About MEO

The MEO business plan is centred on the development of gas-to-liquids (GTL)
projects in the Australian waters of the Timor Sea, approximately 275 km
northwest of Darwin, in an area known as Tassie Shoal. The company has secured
Australian Commonwealth Government environmental approvals for two large-scale
methanol plants (1.8 mtpa) and an LNG plant (3 mtpa) that are valid until 2052.

Tassie Shoal is an area of shallow water adjacent to the Evans Shoal gas field
and is located around 25km east of MEO's exploration permit, NT/P68. MEO mapping
has identified five large structures in NT/P68 two of which were intersected by
the Heron-1 well drilled in 1972, confirming gas columns. The resources
contained in NT/P68 provides significant valuation upside by potentially
providing a feedstock for the GTL projects as an alternative to possible third
party gas supply from nearby resources.

About Xtract Energy Plc

Xtract identifies and invests in a diversified portfolio of early stage energy
sector technologies and businesses with very significant growth potential. We
aim to work closely with the associated management teams to achieve critical
project milestones, to finance later development stages and to build and
crystallise value for all shareholders and partners.

Xtract is supported by its cornerstone investor, Cambrian Mining Plc (AIM:CBM) a
diversified resource investment house which holds 51.6% of its issued share
capital.

A short description of the principal assets of Xtract other than MEO is set out
below. These assets are either held directly or through wholly owned
subsidiaries of the Company.

Elko Energy

Elko is an oil & gas exploration company which has an interest in a 5,370km2
exploration and production licence in the Danish North Sea and an investment in
Dragon Energy Inc, a private Canadian company, with a development project in
Gansu Province, China.

Wasabi Energy

Wasabi is a diversified investor in renewable energy and low greenhouse emission
technologies, with interests in geothermal waste/heat, uranium exploration in
Australia's Northern Territory and biodiesel investments in Victoria.

Central Asian Interests

Xtract's Central Asian interests include a production sharing agreement with
Kyrgyzneftegaz to instigate a water injection project on the Beshkent- Togap oil
field. Xtract also holds interests in several exploration licences in the Tash
Kumyr area and in the Toktogul exploration licence.

Oil Shale

Xtract has oil shale and related petroleum product exploration rights over 
mining tenements in the Julia Creek area of Queensland and has recently been 
granted an exploration permit which gives rights to explore for oil shale in 
an area in the South of New Zealand. It is investigating the commercial 
production of hydrocarbons (crude oil) from oil shale.

Xtract is also available for trading on the open market segment of the Frankfurt
Stock Exchange (ticker R9X.FSE).


                      This information is provided by RNS
            The company news service from the London Stock Exchange