Sydney, Australia, October 7, 2005 (Sydney Morning Herald) – Junior explorer Range Resources pinned its hopes on Somalia's Democratic State of Puntland yesterday, signing an agreement that gives it exclusive mineral and oil and gas exploration and development rights in the semi-autonomous state.

Range said it would fund the deal through a $3.45 million non-renouncable 1-for-2 rights issue at 1.5c each.

Executive director Jim Marinis said his company would initially focus on oil and gas exploration, although there was also hope of finding copper, iron ore, manganese, tin and other metals.

Conoco-Phillips and Shell conducted exploration and drilling in the state in the 1980s and early 1990s but the programs were abandoned and the exploration data destroyed after the Somali government was ousted in 1991 and the country descended into famine and tribal warfare.

Range will have a 50.1 per cent interest in all projects and is looking to draw multinationals like Conoco-Phillips and Shell back into the country as farm-in partners and operators.

Range believes the political situation in Puntland, a semi-autonomous state in the country's north-east, near the Horn of Africa, is stable enough to draw investment to the region.

"The state does not experience the 'political unrest' currently affecting Mogadishu and the southern half of Somalia ," Range's release to the stock exchange said.

But the Australian, British and US governments all have strict warnings in place against travel to all regions of Somalia and none maintain an embassy there.

The CIA's World Factbook reports that Puntland disputes its border with the neighboring self-governing province Somaliland and has suffered "civil strife", while the US State Department says "serious fighting" has occurred in the state.

A 15th century BC visit to the Land of Punt, generally believed to be Somalia, by the Queen Hatshepsut of the 18th Dynasty is recorded on the queen's mortuary temple opposite Thebes.

Mr. Marinis has not visited Puntland, reputedly having signed the agreement with the state's government in Dubai . But executive chairman Michael Povey toured the state in April and did so without armed guards, Mr. Marinis said.

"There is definitely no civil unrest," Mr. Marinis said.

Range is now establishing a workforce of Australians, other expats and Somalis and expects to begin exploration by the end of the month.

Nearly one-quarter of Range's shares changed hands yesterday. They closed 0.4c higher at 3c.

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