News 21 September 2009

COMMENCEMENT OF GOLD EXPLORATION PROGRAM & REVIEW OF OPERATIONS


Spitfire Oil Limited (“Spitfire” or the “Company”) is pleased announce that it has commissioned a gold exploration drilling program at its Salmon Gums tenements. The Company has been aware for some time of the activity of a significant number of mining companies seeking to peg ground on the south-west trending greenstone belt hosting the Tropicana gold deposit, a large portion of which greenstone resides on the Company’s large tenement package at Salmon Gums. Spitfire’s geological assessment of the gold prospectivity of its tenements has shown that the tenements host the intersection of two regional prospective gold trends and the intersection of two regional faults. Regional geological interpretations indicate a greenstone belt crossing the tenements. Consequently, the Company has commissioned a gold exploration program including 171 aircore holes into the granite basement on a 200m x 800m grid covering the intersection of the two faults. This program is expected to be completed early next year.

Ongoing testwork and investigations, have highlighted the expanding complexity and growth in the scope of research required in refining and finalising the Company’s proprietary L2VTM lignite to oils process to extract distillate from the Salmon Gums lignite. The directors have consequently ordered a complete financial and technical reappraisal of the project, including an analysis of other competing coal-to-liquids technologies, the result of which will be communicated as soon as it is available.

The Company’s results and annual report for the year to 30 June 2009 will be published by the end of the calendar year .