Falcon Oil & Gas Ltd. Announces Negotiations Relating to an Extension of Letter of Intent With Macquarie Bank

    BUDAPEST, Hungary, Jan. 31 /CNW/ -- Falcon Oil & Gas Ltd. (TSXV: FO)
announced today that it is negotiating with Macquarie Bank Limited
("Macquarie") to extend the term of the nonbinding letter of intent relating
to a credit agreement which would provide Falcon with a US$250,000,000 credit
facility as announced in the press release dated October 4, 2006.

    About Falcon Oil & Gas Ltd.
    Falcon Oil & Gas Ltd. is a British Columbia corporation which is in the
business of oil and gas exploration and production.  It has operations in
Hungary through its wholly-owned subsidiary TXM Oil and Gas Exploration, and
in Romania through its wholly-owned subsidiary JVX Energy Corporation. Further
information about Falcon is available at www.falconoilandgas.com.

    Falcon Oil & Gas Ltd.
    Marc A. Bruner, President, Chairman & CEO
    Michael K. Lam, Corporate Development North America
    (416) 303-8810
    Alexander Hubbard-Ford, Corporate Development Europe
    +44 (0) 79 8448 1541

    Canada - Brisco Capital Partners Corp
    Graeme Dick
    (403) 313-9663

    United Kingdom - 4C-Burvale
    Carina Corbett
    John Carrick-Smith
    +44 (0) 20 7559 6710

    In the interests of providing Company shareholders and potential
investors with information regarding the Company, including the Company's
assessment of its and its subsidiaries' future plans and operations, certain
statements included in this press release may constitute forward-looking
information or forward-looking statements (collectively, "forward-looking
statements").  All statements contained herein that are not clearly historical
in nature are forward-looking, and the words "anticipate", "believe",
"expect", "estimate" and similar expressions are generally intended to
identify forward-looking statements.  Similarly, forward-looking statements in
this press release include, but are not limited to anticipated developments of
the Company's drilling project in Hungary and the timing thereof, the
Company's drilling project in Romania and the timing thereof, capital
investment levels and the allocation thereof, pipeline capacity, government
royalty rates, reserve and resources estimates, the level of expenditures for
compliance with environmental regulations, site restoration costs including
abandonment and reclamation costs, exploration plans, acquisition and
disposition plans including farmout plans, net cash flows, geographic
expansion and plans for seismic surveys.  In addition, please note that
statements relating to "reserves" or "resources" are deemed to be
forward-looking statements, as they involve the implied assessment, based on
certain estimates and assumptions, that the reserves and resources described
can be profitably produced in the future.  Such statements represent the
Company's internal projections, estimates or beliefs concerning, among other
things, an outlook on the estimated amounts and timing of capital
expenditures, anticipated future debt levels and incentive fees or revenues or
other expectations, beliefs, plans, objectives, assumptions, intentions or
statements about future events or performance.  These statements are only
predictions.  Actual events or results may differ materially.  Although the
Company believes that the expectations reflected in the forward-looking
statements are reasonable, it cannot guarantee future results, levels of
activity, performance or achievement since such expectations are inherently
subject to significant business, economic, competitive, political and social
uncertainties and contingencies.  Many factors could cause the Company's
actual results to differ materially from those expressed or implied in any
forward-looking statements made by, or on behalf of, the Company and the
foregoing list of important factors is not exhaustive.  These forward-looking
statements are made as of the date hereof disclaims any intent or obligation
to update publicly any forward-looking statements, whether as a result of new
information, future events or results or otherwise.  Company shareholders and
potential investors should carefully consider the information contained in the
Company's filings with Canadian securities administrators at www.sedar.com
before making investment decisions with regard to the Company.
    The TSX Venture Exchange does not accept responsibility for the adequacy
or accuracy of this release.

For further information:

For further information: Marc A. Bruner, President, Chairman & CEO, or 
Michael K. Lam, Corporate Development North America, both of Falcon Oil & Gas 
Ltd., +1-416-303-8810, or Alexander Hubbard-Ford, Corporate Development Europe
 of Falcon Oil & Gas Ltd., +44 (0) 79 8448 1541; or Canada, Graeme Dick of
Brisco  Capital Partners Corp, +1-403-313-9663, for Falcon Oil & Gas Ltd.; or
United  Kingdom, Carina Corbett or John Carrick-Smith, both of 4C-Burvale, +44
(0) 20  7559 6710, for Falcon Oil & Gas Ltd. Web Site:

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