Ann: Placement to Raise $1.033M , page-2

The Directors of Key Petroleum Limited (?Key? or ?the Company?) are pleased to advise that the Company has raised approximately $1.033 million through the placement of 19,501,887 shares at $0.053 per share (?Placement?). The Placement, coordinated by Pursuit Capital Pty Ltd who acted as Lead Manager, has been made to Institutional Investors and Sophisticated Investor within the Company?s 15% placement capacity, under ASX Listing Rule 7.1. The monies raised from the Placement will be used for general working capital purposes and in relation to the drilling of the two new wells in the North Perth Basin, previously announced on 28th June 2010.
Those investors who have subscribed to 4 million shares or more in this Placement will be allocated unlisted options in the Company, based on 1 for 2 basis, with an exercise price of $0.075 per option. Expiry of the options will be on 30 November 2011. These options are subject to shareholder approval being granted.
Key Petroleum?s Managing Director /CEO, Ken Russell commented:
?We welcome the strong support by new and existing shareholders for this Placement. It is a show of faith in the Company?s decision to move into the North Perth Basin?.
?The response to this placing indicates that the Company?s actions in entering into new areas with a view to steadily building up its resource base are supported by institutional and sophisticated investors?, Mr. Russell said.
Mr. Russell also commented, ?The Company?s management views the new venture in the North Perth Basin as a prudent step in the Company?s use of its funds and demonstrates its ability to take advantage of suitable opportunities wherever they are to be found?.
This announcement will lift the present trading halt in Key?s securities.