ADDAX Petroleum Corporation has announced the completion of the previously announced acquisition of almost all of the assets and operations of Pan-Ocean Energy Corporation Limited for cash consideration of CDN $1.605 billion (Canadian dollars).

Mr Jean Claude Gandur, President and Chief Executive Officer of Addax Petroleum noted that he was delighted at the pace and efficiency, which has dogged the acquisition.
“I am pleased at how quickly and efficiently this Acquisition process was completed and look forward to building on Pan-Ocean’s dynamic business in Gabon for the benefit of all our stakeholders.

We are delighted to welcome the Pan-Ocean teams into our Addax Petroleum family and are excited at the additional value growth potential that the Acquisition provides for our shareholders.

We expect the Acquisition to have an immediate positive impact as it will raise our anticipated 2006 exit production rate to close to 120,000 barrels per day and give us an average production rate of over 130,000 barrels per day in 2007.
Moreover, the Acquisition improves our reserve life index. We have made the quick and smooth integration of the acquired Pan-Ocean business with our current Addax Petroleum businesses a priority, which will lay the foundations for a new generation independent exploration and production company,” he said.

With the successful closing of the Acquisition, holders of Addax Petroleum’s 14,750,000 subscription receipts will receive one common share in the share capital of Addax Petroleum per Subscription Receipt, without payment of any additional consideration.
As the Subscription Receipts trade in the ‘book-entry’ system and no individual certificates are issued, holders of Subscription Receipts are not required to take any action in order to receive the Common Shares to which they are entitled.

Holders of Subscription Receipts that convert into Common Shares are entitled to receive a special payment equivalent to the amount of the initial quarterly dividend previously announced by Addax Petroleum of CDN$0.05 per share payable on September 14, 2006.
The proceeds from the offering of Subscription Receipts have been released to Addax Petroleum from escrow and were used along with other funds to pay the purchase price for the Acquisition.

Founded in 1994, Addax Petroleum, majority-owned by the Addax & Oryx Group, is an international oil and gas exploration and production company focused on Africa and the Middle East.

Addax Petroleum has rapidly grown to become the largest independent oil producer in Nigeria, one of the most prolific oil and gas regions in the world.

Addax Petroleum has grown by acquiring under-developed properties in established basins and has increased its production by utilizing advanced and proven technologies.

Addax Petroleum believes that its demonstrated operational and technical expertise, combined with its excellent reputation and strong community relationships throughout Africa and the Middle East, make it well positioned to continue to grow its reserves and production. Addax Petroleum has a high quality asset base, consisting of a number of producing properties in Nigeria and exploration and development properties and new venture opportunities in West Africa and the Kurdistan Region of Iraq. Addax Petroleum employs a staff of 344 as of December 31, 2005, of whom 245 were in Nigeria where output has exceeded the 100,000 barrels per day capacity.