Africa Oil Signs Definitive Agreement With Denovo for Transfer of Puntland Subsidiaries

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Aug. 11, 2011) - Africa Oil Corp. (TSX VENTURE:AOI)(OMX:AOI) ("Africa Oil" or the "Company") is pleased to report, further to its May 12, 2011 news release, that it has now signed a definitive agreement (the "Share Exchange Agreement") with Denovo Capital Corp. ("Denovo") pursuant to which Africa Oil will transfer to Denovo its 60% participating interest in the Puntland (Somalia) projects (the "Transaction"). Africa Oil's 60% participating interest in each of the Dharoor Valley and the Nugaal Valley Production Sharing Agreements in Puntland (Somalia) is indirectly held by its wholly owned subsidiary, Canmex Holdings (Bermuda) I Ltd.("Canmex I"). Pursuant to the Share Exchange Agreement, all of the issued and outstanding shares of Canmex I will be transferred to Denovo. In consideration of the transfer, Africa Oil will receive 27,777,778 common shares of Denovo.

Denovo is a capital pool company and intends for the Transaction to constitute its "Qualifying Transaction", as that term is defined in the policies of the TSX Venture Exchange (the "Exchange").

The Share Exchange Agreement provides for conditions precedent that are standard for a transaction of this nature, including receipt, by both Africa Oil and Denovo, as required, of all regulatory, partner and third party approvals including Exchange approval. At its June 30, 2011 meeting of shareholders Denovo obtained shareholder approval for a 0.65 (new) for 1.00 (old) consolidation of its common shares and a change of name to Horn Petroleum Corporation ("Horn Petroleum").

On August 2, 2011, Denovo completed a $40.98 million private placement financing, with assistance from Africa Oil. These proceeds will be used to fund Denovo's share of costs associated with the drilling of two exploratory wells in the Dharoor Valley Block. Africa Oil subscribed for $10 million of the private placement and will have an approximately 50% interest in Denovo when the Transaction completes.

Final planning for a two well exploratory drilling campaign in the Dharoor Valley Block is underway. Drilling locations have been selected over two robust prospects targeting gross best estimated prospective resources of over 300 million barrels each, based on internal estimates. Contracts are being entered into with drilling and drilling related subcontractors and ground drilling and logistical operations have commenced.

The Puntland Government and Dharoor Valley communities are fully supportive of the drilling project and have ensured they will do all that they can to allow the project to move forward safely and expeditiously. Specific milestone target dates have been adjusted by the Puntland Government allowing the partners to move the drilling start-up to the fourth quarter of 2011. In addition, partial relinquishments in both the Dharoor Valley and Nugaal Valley agreements have been finalized and approved. The Puntland Government has also given its approval for the formation of Horn Petroleum and the pending transaction with the Company.

Africa Oil Corp. is a Canadian oil and gas company with assets in Kenya, Ethiopia and Puntland (Somalia). Africa Oil's East African holdings are in within a world-class exploration play fairway with a total gross land package in this prolific region in excess of 300,000 square kilometers. The East African Rift Basin system is one of the last of the great rift basins to be explored. New discoveries have been announced on all sides of Africa Oil's virtually unexplored land position including the major Albert Graben oil discovery in neighbouring Uganda. Similar to the Albert Graben play model, Africa Oil's concessions have older wells, a legacy database, and host numerous oil seeps indicating a proven petroleum system. Good quality existing seismic show robust leads and prospects throughout Africa Oil's project areas. The Company is listed on the TSX Venture Exchange and on First North at NASDAQ OMX-Stockholm under the symbol "AOI".

FORWARD-LOOKING STATEMENTS

Certain statements made and information contained herein constitute "forward-looking information" (within the meaning of applicable Canadian securities legislation). Such statements and information (together, "forward looking statements") relate to future events or the Company's future performance, business prospects or opportunities. Forward-looking statements include, but are not limited to, statements with respect to estimates of reserves and or resources, future production levels, future capital expenditures and their allocation to exploration and development activities, future drilling and other exploration and development activities, ultimate recovery of reserves or resources and dates by which certain areas will be explored, developed or reach expected operating capacity, that are based on forecasts of future results, estimates of amounts not yet determinable and assumptions of management.

All statements other than statements of historical fact may be forward-looking statements. Statements concerning proven and probable reserves and resource estimates may also be deemed to constitute forward-looking statements and reflect conclusions that are based on certain assumptions that the reserves and resources can be economically exploited. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as "seek", "anticipate", "plan", "continue", "estimate", "expect, "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe" and similar expressions) are not statements of historical fact and may be "forward-looking statements". Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. The Company believes that the expectations reflected in those forward-looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct and such forward-looking statements should not be unduly relied upon. The Company does not intend, and does not assume any obligation, to update these forward-looking statements, except as required by applicable laws. These forward-looking statements involve risks and uncertainties relating to, among other things, changes in oil prices, results of exploration and development activities, uninsured risks, regulatory changes, defects in title, availability of materials and equipment, timeliness of government or other regulatory approvals, actual performance of facilities, availability of financing on reasonable terms, availability of third party service providers, equipment and processes relative to specifications and expectations and unanticipated environmental impacts on operations. Actual results may differ materially from those expressed or implied by such forward-looking statements.

ON BEHALF OF THE BOARD

Keith C. Hill, President and CEO

Africa Oil's Certified Advisor on First North is E. Öhman J:or Fondkommission AB.