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$50 Million Dollar-51 Well Drilling Program - 14 Out of 16 Wells Strike Oil - Avg. 94% Drilling Success on ACOR's ORRI Under ATP-299 on the $5 Billion Dollar Potential Oil Field - Could ACOR's PEL 112 Have the Potential to Be Another ATP-299?

Posted on: Monday, 19 June 2006, 09:00 CDT

Australian-Canadian Oil Royalties Ltd. (herein called ACOR) (OTCBB:AUCAF) reports that the JV partner of ATP-299 is pleased to announce that they have achieved a phenomenal 94% success rate on ACOR's ORRI, with 14 of the 16 wells that encountered oil in the Birkhead reservoirs at the Mulberry, Endeavour and Gimboola Oil Fields having been completed as future oil producers. The Tintaburra wells are progressively being tied in to the production system with 6 wells now producing oil and the program is on track to add significant oil production volumes for ACOR's ORRI this year.

The Tintaburra program on ACOR's ORRI is the largest continuous oil development and exploration drilling program ever undertaken in SW Queensland with 3 modern rigs drilling and casing wells at around 7 days per well. The Tintaburra program will continue at least into October 2006 with the balance of 34 wells to be drilled. In addition, planning is currently underway to drill an additional 9 development/delineation wells at the Mulberry field.

About The Mulberry Oil Field:

Mulberry-1 was drilled in 2004 and is producing oil at a rate of approximately 600 barrels of oil per day. The 51 wells are designed to achieve additional oil production and to test the extent of the oil pool in the Birkhead 11-77 sand discovered in the Mulberry-1 well.

The Mulberry-Gimboola-Endeavour Field is part of the Tintaburra Oil Field on ACOR's ORRI under ATP-299 and is estimated to contain around 84 million barrels of proved plus probable oil in place or approximately $5,036,640,000, at current market prices.

ACOR owns .0575 of 1% ORRI under ATP-299.

ACOR Management Helped Discover Oil on ATP-299 Approximately 30 Years Ago

Robert Kamon is a director of ACOR and one of the largest shareholders in the company. In the late 1970s, Robert noticed the East-West oil migration path in the Cooper/Eromanga Basin and stepped out approximately 92 miles East from the nearest oil & gas producing field (the Jackson Field) and leased what would be considered at the time a rank wildcat area, called ATP-299.

The 1st well drilled on ATP-299 was called the Tintaburra #1 and it came in with an initial potential of approximately 1835 barrels of oil per day from two zones. Successful well after well was drilled and completed on ATP-299 and a large oil company bought ATP-299 for several hundred million dollars.

Could PEL 112 Have the Potential to Be Another ATP-299?

PEL 112 has not been explored for almost 40 years!

The model for oil entrapment along the Cooper Basin flanks in southwest Queensland is by now well understood. It is probable because of the oil pools discovered in fields such as the Tintaburra Oil Field, located on ACOR's ORRI under ATP-299.

In the South Australian part of the Cooper/Eromanga Basin, the flanks have been almost untouched by modern exploration for almost 40 years. They remain virgin acreage, yet tantalizingly close to a proven source of oil generation.

ACOR management's goal is to follow up the successful Christies, Sellicks, & Worrior oil discoveries to the east and north of ACOR's PEL 112 and to continue to probe in the southern flank in the Southern Australian part of the Cooper/Eromanga Basin to unlock the many riddles that persist in this area.

ACOR management would like to prove to our shareholders that PEL 112 could possibly yield giant oil discoveries like those that have been discovered on ATP-299. ACOR has invested approximately five (5) years of time and several million dollars on PEL's 112, 108, & 109.

PEL 112 covers 818,904 acres and has never been drilled on (no dry holes) and is located in the Cooper/Eromanga Basin of South Australia. ACOR has just completed a new seismic survey on PEL 112 at a cost of approximately $1,100,000. The new seismic survey has discovered two large seismograph highs as well as 24 smaller ones. The two large seismograph highs are called C-23 & C-26, which cover a combined area of approx. 5,534 acres with excellent closure.

Profitable Production Almost Surrounds ACOR's PEL 112

As stated in previous ACOR press releases, twelve (12) new wells adjoining PEL 112 to the North, East & West have been announced for drilling in 2006. Five (5) wells out of six (6) of these 12 wells announced have struck oil. This is, by industry standards, an exceptional 83% success ratio. The latest successful well to be drilled that adjoins ACOR's PEL 112 was the Sellicks-2, with an initial potential of approximately 2700 barrels of oil per day ("BOPD"), a new oil pool discovery and is to be completed as a multiple zone oil producer.

All the wells mentioned below adjoin ACOR's PEL 112 to the north and to the east. Silver Sands-1 well came in with an initial potential of 1062 BOPD Christies-1 well came in with an initial potential of 500 BOPD Christies-2 well came in with an initial potential of 1960 BOPD Christies-3 well came in with an initial potential of 2400 BOPD Christies-4 well came in with an initial potential of 653 BOPD Christies-5 well came in with an initial potential of 403 BOPD Sellicks-1 well came in with an initial potential of 1780 BOPD Worrior-1 well came in with an initial potential of 2800 BOPD Worrior-2 well came in with an initial potential of 2000 BOPD Worrior-3 well came in with an initial potential of 276 BOPD Worrior-4 well came in with an initial potential of 1660 BOPD

The current production on the adjoining area to the north of ACOR's PEL 112 is averaging a reported $33,000,000 a year.

The current production on the adjoining area to the east of ACOR's PEL 112 is averaging a reported $75,000,000 a year.

Why is ACOR Management talking about the Wells that adjoin ACOR's PEL 112?

Take the smallest of the recent discoveries (276 BOPD) and multiply (x) it by $70.00 per barrel, current market price of crude oil times (x) 30 days, times (x) 12 months and apply the result times (x) ACOR's PEL 112 Working Interest and see the potential gross revenues for yourself. Now do the same calculations using the largest discovery that adjoins ACOR's PEL 112.

Smallest Discovery so far, Worrior-3 IP276 BOPD

Largest Discovery so far, Worrior-1 IP2,800 BOPD

Now you can see why ACOR management is so excited about all the drilling activity that is going on adjoining ACOR's PEL 112 to the north and east. In our opinion, any one of the recent discoveries from the smallest to the largest could be a possible "Company-Maker" discovery for our company, if discovered on PEL 112.

This is some of the most profitable production in onshore Australia, and ACOR is in the middle of it.

ACOR owns 41.5% WI under PEL's 108, 109, & 112.

ACOR Onshore Australia Update:

ACOR has received farmout requests for a portion of ACOR's 41.5% working interest under PEL 108, 109, & 112 and a portion of ACOR's 100% working interest under ATP-582, covering approximately 8,414,348 gross acres. Both areas are located in the Cooper/Eromanga Basin in South Australia and Queensland. ACOR management is seriously reviewing the farmout requests.

Results of the meetings will be shared with you in the Wednesday, June 21st press release.

About Australian-Canadian Oil Royalties Ltd.:

ACOR management draws no cash salary. ACOR has NO LONG-TERM DEBT. ACOR's principal assets consist of 15,440,116 gross surface acres of overriding royalty interest and 8,561,007 gross acres of working interests, located Onshore Australia in the Cooper-Eromanga Basin and Offshore Australia in the Gippsland Basin in the Bass Strait.

ACOR is a publicly traded oil company trading on the NASDAQ OTC Bulletin Board Exchange under the trading symbol "AUCAF."

Summary:

Australia is a "hot spot" for oil & gas exploration and ACOR is positioned for possible "Company-Maker" discoveries. ACOR's working interest and overriding royalty interest are located offshore & onshore in the best producing basins.

Visit our website at www.aussieoil.com.

Disclaimer:

Except for historical information contained herein, the statements released are forward-looking statements that are made pursuant to the provision of the Private Securities Litigation Reform Act of 1955. Forward-looking statements involve known and unknown risks and uncertainties that may cause the Company's actual results in future periods to differ materially from forecasted results. Such risks and uncertainties include, but are not limited to, market conditions, competitive factors, the ability to successfully complete additional financings and other risks.

Source: Business Wire

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