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AusTex Oil Limited (ASX:AOK) $12.5m Raising to Further Development of Mississippi Lime

Sydney, Australia, Oct 17, 2012 - (ABN Newswire) - AusTex Oil Limited (ASX:AOK.AX - News) (OTCQX:ATXDY - News) is pleased to announce an equity capital raising to raise up to A$12.5 million ("Offer") which will fund the appraisal and development of the Company's acreage in the light oil sweet spot of the Mississippi Lime Play.

The Offer comprises:

- A Placement of approximately 83.3 million new fully paid ordinary shares to sophisticated and professional investors at a price of $0.12 per share ("Issue Price") which raised $10.0million; and,

- A Share Purchase Plan ("SPP") of up to $15,000 per eligible shareholder at the Issue Price to raise up to $2.5 million.

GMP Securities is Sole Lead Manager and Bookrunner to the Placement.

The Placement was strongly supported by existing shareholders and new investors, and has resulted in a number of domestic and institutional investors joining AusTex's register.

The Placement will be completed in two tranches with the first tranche of 29.3 million shares expected to settle on Wednesday 24 October 2012, and the second tranche of approximately 54 million shares subject to shareholder approval at an Extraordinary General Meeting expected to be held on or around 21 November 2012 with the date to be confirmed.

The SPP will provide eligible shareholders (being those persons registered as ordinary shareholders as at 7pm EDST on Tuesday 16 October 2012 who reside in Australia or New Zealand) with the opportunity to subscribe for new ordinary shares in AusTex at the same price as the Placement. Further details of the SPP will be provided to eligible shareholders in due course.

Use of Proceeds

Net proceeds from the Offer will be used to fund appraisal and development of AusTex's acreage in the light oil rich sweet spot of the Mississippi Lime Play, including:

- Participating in additional horizontal wells with Range Resources Corporation (NYSE:RRC - News), including an offsetting well to the highly successful Balder #1-30N (1st 30-day average rate 899 boepd, 70% oil);

- Continuation of the two vertical well per month program at the company's 100% owned Snake River Project in Northern Oklahoma;

- Drilling activity at AusTex's properties in Kansas; and

- Pursuing opportunities to expand AusTex's acreage position via land acquisitions and joint ventures.

Commenting on the Offer AusTex's Managing Director Dan Lanskey, said:

"We are very encouraged by the strong support for this Placement and it is a solid endorsement of the quality of AusTex's acreage position, its production success to date, and the Company's strategy of targeting the light oil sweet spot of the Mississippi Lime Play.

"The result from Balder #1-30N is very encouraging for our future horizontal well program with Range Resources which will complement our growing, low risk vertical production. Funds raised under the Offer will enable AusTex to fast track appraisal and development activity in our core area and drive production growth.

"We are pleased to welcome a number of new institutional investors to the AusTex register and we are grateful for their support. Their investment provides the Company with a strong platform to pursue its next phase of growth. In addition, AusTex is pleased to offer existing shareholders the opportunity to gain further exposure to AusTex at the same price as the Placement."

Follow Austex on Twitter: https://twitter.com/AusTexAOK

About AusTex Oil Limited:

AusTex Oil Limited (ASX:AOK.AX - News) (OTCQX:ATXDY - News) is an Australia-based company. The Company is engaged in the development of oil and gas leases in the United States. It produces oil and gas from leases in Oklahoma and Kansas. It is also engaged in the exploration, development and production of hydrocarbons in the United States. Its wholly owned subsidiaries include International Energy Corporation (Oklahoma), International Energy Corporation (Kansas) and Well Enhancement Services LLC. During the year fiscal year ended March 31, 2009 (fiscal 2009), the Company was engaged in the drilling of three wells on the Lancaster Lease group, Tulsa County; two wells on the Sweet Unit, Pawnee County, and one well on the BlueHawk Project in Osage County.

Contact:

AusTex Oil Limited T: +61-2-9238-2363 F: +61-2-8088-7280 WWW: www.austexoil.com

Source:

AusTex Oil Limited

Copyright (C) 2012 ABN Newswire. All rights reserved.

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