SUGARKANE FIELD OPERATIONS AND PRODUCTION UPDATE

/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/

TORONTO, May 12 /CNW/ - Aurora Oil & Gas Limited ("Aurora") is pleased to provide the following update on operations and production at the Longhorn, Ipanema and Excelsior Areas of Mutual Interest ("AMI") within the Sugarkane Gas & Condensate Field, Texas.

Across Aurora's gross acreage position of 74,800 acres there are presently 4 drilling rigs and 2 full time fracture stimulation crews operating, with a temporary 3rd stimulation crew carrying out 'HiWay' stimulations on 4 wells. The operator is ahead of target to complete the planned 60 well drilling program in 2011.

Production Data

The Foster #1H well has now been on production for a period of 30 days with results as outlined below:-

  AMI Working
Interest
Total Gas
Production
(mmscf)
Total
Condensate
Production
(bbls)
Average Daily
Equivalent Oil
Rate (boe/d)*
Foster #1H Ipanema 34.3% 52.9 12,852 758

*The equivalent barrels per day production rate has been calculated on a simple 6:1 ratio in compliance with Canadian securities laws under National Instrument 51 - 101.

There are a number of wells that commenced production since the last ASX update within the Longhorn, Ipanema and Excelsior AMIs and Aurora will provide 30 day and 60 day average production rates for those wells when available.

Operations

Longhorn AMI

Yosko #1H (29.6% WI)
The Yosko #1H well has been fracture stimulated and was placed on production on 11/04/11.

Carter #1H (31.9% WI)
The Carter #1H well has been fracture stimulated and was placed on production on 17/04/11.

Carter Salge #1H (31.9% WI)
The Carter Salge #1H well has been fracture stimulated and was placed on production on 01/05/11.

Davenport #1H (24.31% WI)
The Davenport #1H well location lies across the Longhorn and Sugarloaf AMI boundaries and as such Aurora holds a 24.31% working interest in the well.  The well reached a total depth of 18,220ft on 23/04/11.  Production casing has been run and cemented in place and the well will be fracture stimulated shortly.

Turnbull #6H (26.39% WI)
The Turnbull #6H well sits partially within the Sugarloaf AMI and hence Aurora holds a blended working interest of 26.39% in this well.  The well was spudded 30/04/11 and is presently at a depth of approximately 12,000 ft.

Best Huth #1H (28.73% WI)
The Best Huth #1H well sits partially within the Sugarloaf AMI and hence Aurora holds a blended working interest of 28.73% in this well.  The well spudded on 02/05/11 and is presently drilling out of the surface casing shoe.

Ipanema AMI

PMT #1H (28.7% WI)
This PMT well location lies across the Ipanema and Sugarloaf AMI areas.  As such Aurora holds a blended working interest of 28.7% in this well.  This well has been fracture stimulated and for operational reasons production tubing was run.  The well is now unloading and is cleaning up to flare.

Excelsior AMI

Chapman Pfeil #1H (9.1% WI)
The Chapman Pfeil #1H well has been fracture stimulated and will shortly be unloaded to sales.

Chapman Rothe #1H (9.1% WI)
The Chapel Rothe #1H well is being fracture stimulated and will shortly be unloaded to sales.

Henke A #1H (9.1% WI)
The Henke A #1H well has been fracture stimulated, the operations are presently completing and the well will then be unloaded to sales.

Hierholzer Seewald #1H (9.1% WI)
The Hierholzer Seewald #1H well is being fracture stimulated and will shortly be unloaded to sales.

Henke B #1H (9.1% WI)
The Henke B #1H well reached a total depth of 15,635 ft on the 12/04/11 and casing has been run and cemented.  The well has been fracture stimulated and will shortly be unloaded to sales.

Hierholzer Retzloff #1H (9.1% WI)
The Hierholzer Retzloff #1H well has been drilled and cased at a total depth of 15,450 ft.  The well will be fracture stimulated in due course.

Esse Smith Ranch A #1H (9.1% WI)
The Esse Smith Ranch A #1H well is presently being drilled having been spudded on the 18/04/11.

Excelsior Production Facilities
Good progress is being made on the installation of the first centralized processing facility in the field. This facility is located in the Excelsior AMI and will lead to significant savings in well costs and reductions in operating costs.  Other similar installations will be installed in due course across Aurora's four Sugarkane AMIs.

About Aurora

Aurora is an Australian and Toronto listed oil and gas company active exclusively in the over pressured liquids rich region of the Eagle Ford Shale in Texas, United States.  The Company is engaged in the development and production of oil, condensate and natural gas in Karnes, Live Oak and Atascosa counties in South Texas.  Aurora participates in over 74,800 highly contiguous gross acres in the heart of the trend, including over 15,760 net acres within the liquids rich zones of the Eagle Ford.  Aurora is funded for and expects to participate in approximately 60 new development wells during 2011.

Technical information contained in this report in relation to the Sugarkane field was compiled by Aurora from information provided by the project operator and reviewed by I L Lusted, BSc (Hons), SPE, a Director of Aurora who has had more than 15 years experience in the practice of petroleum engineering. Mr. Lusted consents to the inclusion in this report of the information in the form and context in which it appears.

Cautionary Statements

The Company may present petroleum and natural gas production and reserve volumes in barrel of oil equivalent ("boe") amounts. For purposes of computing such units, a conversion rate of 6,000 cubic feet of natural gas to one barrel of oil equivalent (6:1) is used. The conversion ratio of 6:1 is based on an energy equivalency conversion method which is primarily applicable at the burner tip and does not represent value equivalence at the wellhead. Readers are cautioned that boe figures may be misleading, particularly if used in isolation.

Statements in this press release regarding which reflect management's expectations relating to, among other things, target dates, Aurora's expected drilling program and the ability to fund development are forward-looking statements, and can generally be identified by words such as "will", "expects", "intends", "believes", "estimates", "anticipates" or similar expressions. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances are forward-looking statements. These statements are not historical facts but instead represent management's expectations, estimates and projections regarding future events.

Although management believes the expectations reflected in such forward-looking statements are reasonable, forward-looking statements are based on the opinions, assumptions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. In addition, if any of the assumptions or estimates made by management prove to be incorrect, actual results and developments are likely to differ, and may differ materially, from those expressed or implied by the forward-looking statements contained in this document. Such assumptions include, but are not limited to, general economic, market and business conditions and corporate strategy. Accordingly, investors are cautioned not to place undue reliance on such statements.

All of the forward-looking information in this press release is expressly qualified by these cautionary statements. Forward-looking information contained herein is made as of the date of this document and Aurora disclaims any obligation to update any forward-looking information, whether as a result of new information, future events or results or otherwise, except as required by law.

SOURCE Aurora Oil

For further information:

Level 20, 77 St. Georges Terrace Perth, Western Australia 6000
GPO Box 2530 Perth, Western Australia 6001
T+61 8 9440 2626 F +61 8 9440 2699
Einfo@auroraoag.com.au W www.auroraoag.com.au

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Aurora Oil & Gas Limited

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