Mr. David Grellman reports

HORN PETROLEUM $15 MILLION PRIVATE PLACEMENT

Horn Petroleum Corp. has agreed to sell on the basis of a non-brokered private placement an aggregate of up to 18.75 million units at a price of 80 cents per unit for gross proceeds of up to $15-million.

Each unit comprises one common share and one-half of a share purchase warrant. Each whole warrant is exercisable over a period of two years at a price of $1.20 per share. In the event that Horn Petroleum common shares trade at or above $1.50 for a period of 20 consecutive days, a forced exercise provision will come into effect. A 5-per-cent finder's fee may be payable in either cash or units on all or a portion of the private placement.

Net proceeds of the private placement will be used toward the company's continuing work program in Puntland, Somalia, and for general working capital purposes. Shares issued pursuant to the private placement will be subject to a four-month hold period. The company will make commercially reasonable efforts to have the warrants posted for trading on the TSX Venture Exchange after the expiry of the hold period.

We seek Safe Harbor.