Eagle Ford Shale Sugarloaf Acquisition and Global Equity Raising

PERTH, AUSTRALIA--(Marketwire - May 14, 2012) -

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Aurora Oil & Gas Limited (TSX:AEF)(ASX:AUT) ("Aurora") is pleased to announce that it has agreed to acquire an additional 6% non-operated working interest in the Sugarloaf Area of Mutual Interest ("AMI") for US$95 million cash, subject to customary post-closing adjustments. The Sugarloaf AMI is located within the Sugarkane Field, onshore United States, in the liquids rich area of the Eagle Ford shale trend. Aurora already participates in the Sugarloaf AMI and upon completion of the acquisition its working interest will increase from 15.8% to 21.8%. The acquisition will provide approximately 1,440 additional net acres, resulting in Aurora's net acreage in the Sugarkane Field increasing by approximately 9% to over 17,800 net acres. The additional acreage is operated by Marathon Oil EF LLC. The acquisition is expected to close on or about June 29, 2012, subject to the satisfaction of customary sale conditions, and is expected to be funded from existing cash on hand and existing credit facilities to the extent required.

The acquisition follows Aurora's recently announced A$107 million on-market unconditional takeover offer for Eureka Energy Limited which holds approximately 1,521 net acres in the same Sugarloaf AMI through a 6.25% non-operated working interest in the AMI.

Aurora is also pleased to announce plans to raise additional funds through a global offering of ordinary shares at a price to be determined in the context of the market with final terms determined at the time of pricing. The global offering will be conducted in Canada as a prospectus offering and in Australia (and elsewhere) as a placement of ordinary shares. In connection with the proposed offering, Aurora has filed a preliminary short form prospectus with the securities regulatory authorities in each of the Provinces of Canada for which Aurora has obtained a receipt.

In Australia and elsewhere other than Canada, the placement will be available to institutional and sophisticated investors. The shares will be issued without shareholder approval utilising the Company's 15% placement capacity.

Aurora also intends to complete a non-brokered private placement of ordinary shares at the Australian dollar offering price to certain of Aurora's directors, subject to shareholder approval.

Net proceeds from the proposed equity issuances will be used to fund the development costs associated with the increased acreage position, potential future acquisitions of additional oil and gas properties in the Eagle Ford shale trend, and for working capital. Closing of the proposed equity issuances is subject to TSX approval.

Euroz Securities Limited and TD Securities Inc. have been appointed by Aurora as Joint Lead Managers to the proposed global offering.

Aurora Executive Chairman and Chief Executive Officer Jon Stewart said:

"This acquisition builds Aurora's already strong presence in the Sugarkane Field, growing our portfolio of Eagle Ford interests within our key focus area and in line with our stated strategy. It also further aligns our interests with Marathon, the operator of the Sugarkane Field.

This is one of a growing number of opportunities we see within our key focus area where acreage holders are willing to realise clear and certain value for interests that require access to additional capital. Aurora is fortunate to have a strong and conservatively geared balance sheet to fund its continued participation in the development of the Sugarkane Field."

The short form preliminary prospectus is also available on SEDAR at www.sedar.com.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities of Aurora in the United States or in any jurisdiction in which such offer, solicitation or sale would be unlawful. The securities to be offered have not been and will not be registered under the United States Securities Act of 1933, as amended, or any state securities laws, and may not be offered or sold within the United States absent registration or an applicable exemption from the registration requirements of the United States Securities Act of 1933, as amended, and applicable state securities laws.

Cautionary and Forward Looking Statements

Statements in this press release reflect management's expectations relating to, among other things, target dates, Aurora's expected drilling program, the benefits of its proposed acquisitions and the ability to fund its development program are forward-looking statements, and can generally be identified by words such as "will", "expects", "intends", "believes", "estimates", "anticipates" or similar expressions. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances are forward-looking statements. These statements are not historical facts but instead represent management's expectations, estimates and projections regarding future events.

Although management believes the expectations reflected in such forward-looking statements are reasonable, forward-looking statements are based on the opinions, assumptions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. These factors include risks related to: exploration, development and production; oil and gas prices, markets and marketing; failure to complete the acquisitions completed herein; acquisitions and dispositions generally; competition; additional funding requirements; reserve estimates being inherently uncertain; incorrect assessments of the value of acquisitions and exploration and development programs; environmental concerns; availability of, and access to, drilling equipment; reliance on key personnel; title to assets; expiration of licences and leases; credit risk; hedging activities; litigation; government policy and legislative changes; unforeseen expenses; negative operating cash flow; contractual risk; the sufficiency of budgeted capital expenditures in carrying out planned activities; the receipt of all regulatory and third party approvals and management of growth. In addition, if any of the assumptions or estimates made by management prove to be incorrect, actual results and developments are likely to differ, and may differ materially, from those expressed or implied by the forward-looking statements contained in this document. Such assumptions include, but are not limited to, general economic, market and business conditions and corporate strategy. Accordingly, investors are cautioned not to place undue reliance on such statements.

All of the forward-looking information in this press release is expressly qualified by these cautionary statements. Forward-looking information contained herein is made as of the date of this document and Aurora disclaims any obligation to update any forward-looking information, whether as a result of new information, future events or results or otherwise, except as required by law.

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