Investment update

Xtract Energy plc
10 December 2007

10 December 2007                                                        AIM: XTR
                               XTRACT ENERGY PLC
                          ('Xtract' or the 'Company')
                       PROJECT UPDATE - MEO Australia Ltd

Xtract is pleased to refer shareholders to the following press release
announced in Australia by MEO Australia Ltd ('MEO').

Xtract currently holds approximately 21.3% of the issued capital of MEO.

                              'HERON-2 WELL UPDATE

              GAS BEARING HERON NORTH ELANG/PLOVER FM ENCOUNTERED

MELBOURNE, AUSTRALIA (December 10, 2007) -- MEO Australia Limited (ASX: MEO)
advises the market that the Heron-2 well has reached a depth of 3983m and is
currently preparing to run logs ahead of setting a 7 inch liner.

The well intersected the Elang Formation, at a depth of 3929m. The Top Plover
Formation is provisionally picked at 3948m. Both of these sand units have
indications they are gas charged in Heron-2. Interpreted good quality medium
grained Plover sand was encountered from 3973m to 3983m with mud losses of up to
60 bbls/hour, which is being considered as indicative of good reservoir
permeability.

The forward plan is to set the 7 inch liner to isolate the over-pressured
Flamingo Formation. This will allow a slight reduction in mud weight to reduce
the losses for the completion of drilling through the remainder of the Plover
Formation that is interpreted to be gas charged.This configuration also allows
for the possibility of a barefoot production test of the Heron North Plover
Formation subject to confirmation of reservoir parameters by further drilling
and logging, and subject to Joint Venture approval.

Preliminary drilling results of the Plover Formation penetrated to date include:
     
• A wet gas fingerprint based on mud log C1 to C5 values;

• Nominal (1000 - 1400 ppm) carbon dioxide (CO2) levels recorded by mud
  gas detection systems while drilling;

• Plover sands are in-part weakly cemented and friable;

• Elang and Plover Formations appear to be substantially (-35%)
  over-pressured relative to regional Plover sands.

Independent calculation conducted by GeoMechanics International Inc. of the
probable Heron Plover pore pressure based on regional Plover Formation pore
pressure data appear to have been exceeded by approximately 35%. 3D seismic
interpretation indicates that the Heron Plover structures are juxtaposed against
a thick sequence of Flamingo Formation, which modelling suggests is currently
generating wet gas. Additional gas charge from the Flamingo could explain the
elevated pore pressure in Heron North.

Heron-2 encountered gas in the Elang/Plover Formations 237m up-dip of a known
gas bearing interval in Heron-1. Pre-drill interpretation of 3D seismic suggests
the Heron North and Heron South structures are connected with a common observed
flat event at 4260m, interpreted to be coincident with the structural spill
point and possibly representing a gaswater- contact (GWC). The combination of a
wet gas fingerprint, presence of CO2 and the high pore pressure are considered
strong evidence of a gas charged reservoir.

MEO expects to commence drilling the 6 inch hole in the week commencing December
17, 2007.

The participants in the Heron-2 well are:

TSP Arafura Petroleum Pty Ltd (MEO subsidiary) 45%
Oz-Exoil Pty Ltd (MEO subsidiary) 45%
Petrofac Energy Developments Oceania Ltd (Petrofac Limited subsidiary) 10%'

Xtract also notes the announcement that trading in MEO's shares on the ASX has
been suspended at MEO's request, pending the release of a further announcement.

Further information on MEO can be found at www.meoaustralia.com.au. As an ASX
listed company, MEO is not subject to the AIM Rules and this drilling update has
not been reviewed by a named 'qualified person' as defined and required by the
AIM Guidance Note for Mining, Oil and Gas Companies.

Enquiries please contact:

Xtract Energy plc              Andy Morrison, CEO      [phone]

Smith & Williamson Corporate   David Jones 
Finance Limited                Azhic Basirov           [phone]
                               
Scott Harris                   Stephen Scott           [phone]
                               Annabel Michie

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

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 approximately 50.41% of issued
share capital.

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

MEO Australia

MEO is focused on developing gas-to-liquids ('GTL') projects in the Timor Sea
Australia, in an area of shallow water known as Tassie Shoal. It has secured
Commonwealth Government environmental approvals for two large scale (1.8 Mtpa)
methanol plants (50 per cent. interest) and a 3 Mtpa LNG plant (100 per cent.
interest) which are adjacent to the Evans Shoal gas field.

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).




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