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The board of Mosaic Oil has developed a strategy to accelerate growth within the business. • The first stage of this has already been implemented with the Placement and the Rights Issue completed successfully to fund this strategy • Mosaic plans to spend up to $17 million in 2008 on its Queensland oil and gas acreage and its facilities • Over the next three years the Company plans to undertake a total drilling, seismic and development program in the Surat-Bowen Basin estimated at $35-40 million Mosaic Oil is well positioned to implement its chosen strategy to fully exploit existing production and infrastructure assets and revenue streams to invest in future growth opportunities. This strategy aims to 1. Maximise Production from Existing Wells, Lower Risk-Higher Value Fields & Established Infrastructure 2. Farm-out to Better Manage Risk, Accelerate Exploration and Increase Production 3. Actively Pursue New Exploration and Production Opportunities Currently, the Company is reviewing Australian and international opportunities, and in the immediate term Mosaic will continue to actively pursue new exploration and new production opportunities in these markets. Mosaic Oil will continue to focus on fully exploiting the potential of its strategic assets in its Surat-Bowen Basins core project area in Queensland, to provide a sound platform for the future growth of the overall business This will include the continuation of the current Farmout Strategy to better manage risk in high equity exploration and production permits, whilst retaining significant post-farmout equity for participating on upside potential. Commitments from this initiative also assist to accelerate exploration and production and ensure a higher utilisation of existing infrastructure in the future. One asset that differentiates Mosaic from other “junior” explorers, and one that the Company will be able to exploit as part of the Company’s strategy, is its ownership of processing and pipeline infrastructure that not only supports its current production but will also allow for timely and cost-effective development of future discoveries. This infrastructure has the capacity to support increased production from both ongoing development of existing fields and new discoveries, as well as having significant growth potential in itself. The Wallumbilla LPG plant, for example, can be readily expanded above its current production capability levels. |
 LPG Processing Plant at Wallumbilla – Mosaic owns 50% |