SANTOS LIMITED — Capital/Financing Update 2007

ABN 61 058 454 569

Registered Office: Level 4, 19 Arbour Court ROBINA TOWN CENTRE QLD 4230 AUSTRALIA (PO Box 3366)

Ph: $(07) 5562 0077$ Fax: $(07)$ 5562 0011 Web: www.iconenergy.com Email: $[email protected]$

19th June 2007

The Manager Company Announcements Office Australian Stock Exchange Limited 20 Bridge Street Sydney NSW 2000

Dear Sir

Re: UPDATE ON ICON

Sale of assets to Santos QNT Pty Ltd

Following Icon's press release on $29th$ May 2007, Icon confirms that the sale of our interests in ATP 765 and 766 P in the Cooper Eromanga Basin has been signed and completed at a value for Icon's interest of $4,500,000 inclusive of GST. These funds will allow Icon to pursue exploration in its new Queensland permits, which were acquired recently and fund the drilling of Stitch No.1.

Stitch No.1 in ATP 626P

Icon will assume a 100% interest in ATP 626P. This follows a notice made by Santos on $18th$ May 2007, where Santos notified Icon of its intention to withdraw from the drilling of Stitch No.1. The withdrawal becomes effective on 2 July 2007 as per the original agreement.

The expected drilling date is late August to end of September 2007, following the necessary regulatory permitting, land preparation and road construction. Other parties have indicated their desire to farmin for a smaller portion of the interest in this well. If these negotiations are successful, the market will be notified immediately. A drilling rig has been located and negotiations are progressing now.

Stitch No.1 is located in permit ATP 626P about 40 kms south of the Moonie Oilfield. The structure is of similar size to that of the Moonie Oilfield, which had reserves of 25 million barrels. Stitch No.1 relies on the Moonie Fault to trap oil in what is defined as a three way closed fault dependent trap. Nearby wells have extensive oil and gas shows and if the fault trap and

migration mechanism at this location are effective there exists an excellent chance to trap commercial hydrocarbons. The well will be drilled to a depth of about 2000 metres with the reservoir objective being the Precipice Sandstone, which is the same reservoir, found at the Moonie Oilfield.

Coal Bed Methane prospects.

Icon plans to drill two wells in the fourth quarter 2007 in ATP 626P and ATP 849P in the Surat Basin to test the coal bed methane potential of the Walloon Coal Measures. Geological work has started on the coal section in these areas to determine the gas potential. Plans call for the twinning of two old wells where the Walloon coals have been intersected. In former days, it was standard practice when drilling to begin mud logging a well for gas shows when the Hutton Sandstone was reached. The Walloon coal Measures, which lie above the Hutton, were ignored at the time. Further announcements on the wells will be made as soon as the drilling programme draws closer to a firm date.

R. S. James Icon Energy Limited

Afames

Managing Director