Interim Results

Fusion Oil & Gas PLC
25 March 2003

                              Fusion Oil & Gas plc
                           ('Fusion' or 'the Company')


           Interim results for the six months ended 31 December 2002



Fusion Oil & Gas plc, the AIM listed West African oil exploration company,
announces interim results for the six month period ended 31 December 2002.



HIGHLIGHTS:

Exploration Operations



O      Three successful wells drilled offshore in Mauritania.  Conceptual field
studies underway - production start-up from Chinguetti discovery anticipated in
2006.



o       3D seismic data indicates significant further exploration potential -Top
24 prospects have the potential to yield in excess of 3 billion barrels of
un-risked reserves.



O      Farm-out agreements completed with Amerada Hess for two licences in Croix
du Sud and Ntem.



o       Croix du Sud (AGC - Guinea Bissau and Senegal)- 3D seismic completed in
December 2002

o       Ntem (Cameroon) - 3D seismic completed in February 2003



O      New shallow water exploration licence, Dome Flore (AGC) acquired in
January 2003 with 3D seismic survey now complete.



O      Two 3D seismic surveys completed in Gabon.



O      Exploration provision to reflect uncertainty in The Gambia



Financials



O      4.5 m new shares at 45p per share were placed with institutional
investors in September 2002 raising £2.0 million, net of expenses, of additional
working capital



O      Provisioning for a £657,294 write off in The Gambia resulted in operating
loss of £581,358 (six months to December 2001: a loss of £516,533).



O      Loss per share of 0.51p (six months to December 2001: a loss of 0.35p).



O      Pre-tax loss of £496,261 (six months to December 2001: a loss of
£327,345).



O      Cash inflow from operating activities £70,063 (six months to December
2001: outflow of £1,227,443).





Alan Stein, Managing Director of Fusion commented:



'With all eight of our licences now with 3D seismic coverage, we believe we will
be able to reduce technical risk and deliver a busy schedule of high impact
wells in the region over the next two years.'



'We are currently evaluating how best to realise value for shareholders from the
Mauritanian success and are very excited about the prospects for the Dome Flore
concession'.



'It is regrettable that we have had to make a provision for our investment in
The Gambia, but given the uncertainty regarding the administration of petroleum
affairs in The Gambia further exploration activity is not warranted at this
time.'





                                                                   25 March 2003
Enquiries
Fusion Oil & Gas plc
Alan Stein, Managing Director Australia         Tel:       [phone]
                                                Fax:      [phone]
                                                Email:   [e-mail]
Peter Dolan, Chairman England                   Tel:      [phone]
                                                Fax:      [phone]
                                                Email:   [e-mail]

College Hill Associates                         Tel:       [phone]
                                                Fax:      [phone]
James Henderson                                 Email:   [e-mail]
Justine Hibbert                                 Email: [e-mail]



Fusion Oil & Gas plc interim report

In summary, during the period under review and into early 2003, three successful
wells have been drilled off Mauritania, deepwater frontier licences have been
farmed out to Amerada Hess and Fusion has participated in five 3D seismic
surveys;  all of which constitutes significant progress.  More specific details
follow.



Mauritania

The second Mauritanian drilling programme began in mid-2002 and yielded three
successful wells.  The first well, Chinguetti-4-2, was drilled 21/2 km north of
the 2001 Chinguetti-1 discovery and flowed good quality oil when tested. Then an
exploration well was drilled some 20 km to the east (called Chinguetti-4-3)
which was investigating a different type of prospect. A second substantial oil
and gas accumulation, known as Banda, was discovered. Finally, back on the
Chinguetti Field, an appraisal well was drilled and found an oil/water contact,
encouragingly 69 metres lower than forecast.



Conceptual field development studies are now underway which envisage production
start-up from the Chinguetti Field in early 2006 with a rapid build up to
production of about 75,000 barrels per day. While it is natural to focus on the
discoveries that have already been made the real value of the Mauritanian assets
lies in their exploration potential. The large volume of 3D that has been
acquired has yielded an impressive array of prospects and leads. Based on our
own evaluations the top 24 prospects deliver an un-risked resource in excess of
3 billion barrels.



Woodside (the operator) now has plans to drill up to five wells during 2003
which could include up to three exploration wells and two appraisal wells on the
Banda discovery. Your management are currently discussing with the Company's
advisors and third parties how to best optimise the value of this success for
shareholders.



The Gambia, Croix du Sud (AGC) and Ntem (Cameroon)

These licences were the subject of a farmout agreement with Amerada Hess ('
Hess') in August 2002. The essence of the agreement is that Hess will acquire 3D

seismic data and drill two wells on each licence to earn their interest, or
Fusion's equity reverts back to the pre-farmin level. Hess have the option to
withdraw from any individual licence after the 3D seismic is acquired or the
first well is drilled.



The Gambia

In The Gambia, a change in those responsible for the administration of oil and
gas resulted in the Government re-assessing the status of the licence, that has
frustrated attempts to obtain consent to an assignment of interest to Hess. As a
consequence it has become clear, notwithstanding our clear legal position and
consequent opportunity to seek redress, that the commercial merit of pursuing
exploration in this licence is questionable.



Accordingly, as a precaution while discussions with the Government are ongoing,
we do not plan further investment at this time and have made provision to write
off our expenditure incurred to date.



Croix du Sud (AGC)

Government consent for the assignment of interest to Hess in this licence was
processed efficiently and as a result a large 3D seismic survey was started in
November and completed in December 2002.



Ntem (Cameroon)

The Cameroon authorities were, like those in the AGC, efficient in processing
approval of the Hess farmin and accordingly once the seismic vessel used in
Croix du Sud had completed its work there, it moved to the Ntem Permit and
completed another large 3D seismic program in mid February 2003.



Cheval Marin (AGC)

Processing of the large 3D seismic program acquired by AGIP (the Operator) in
early 2002 has been completed and early interpretation work has revealed several

attractive prospects. These will be refined prior to making a drilling
commitment decision in late 2003.



Dome Flore (AGC)

In mid January, an exploration licence was secured over a shallow water area
adjacent to our existing two AGC licences. Following the discovery of two large
heavy oil accumulations over 30 years ago containing in the region of 500 to
1,000 million barrels of oil in place the Dome Flore area has been the subject
of continuing industry interest. There have been many studies undertaken to
determine the economic viability of producing the heavy oil. Indeed it was the
hope of the governments and Senegal and Guinea Bissau that these

accumulations might be developed, that led to the formation of the AGC joint
development zone. It has become clear however that even at prevailing oil prices

and using current technology, the development of the heavy oil is uneconomic. It
has been our long held belief that there maybe a viable exploration play focused
upon the previously neglected light oil shows in reservoirs more deeply buried
than those containing the heavy oil.



The seismic data currently available are of insufficient quality to explore
these deeper reservoirs. Immediately upon award of this licence in January,
Fusion was able to secure the use of a more advanced, modern 3D seismic vessel
on advantageous terms and acquired 380 sq km of 3D seismic which will be
available by mid-year.



Gabon

The 2D seismic data acquired in early 2002 revealed numerous prospects. Although
it had not been planned to acquire 3D seismic until mid 2003, a suitable vessel
became available in late 2002 on very attractive commercial terms. The
opportunity was grasped by the Fusion operated Joint Venture and 625 sq km of 3D
seismic data was acquired by mid-January 2003.



Western Sahara

An extensive set of old seismic and well data has been compiled from various
sources and is being integrated into a coherent technical evaluation of the area
offshore Western Sahara. Although there is still no sign of an early resolution
to the sovereignty dispute between the Saharawi Arab Democratic Republic and
Morocco there is increased political dialogue and, as a result, growing oil
industry interest in the area.



Financial Results

On 20 September 2002, the Company placed 4.5 million new shares at 45p per share
with institutional investors on a non-underwritten basis to raise £2.0 million
(net of expenses) in additional working capital. This resulted in the Company
having funds available at 31 December 2002 of approximately £2.7 million after
recording a loss on ordinary activities after taxation of £496,261 or 0.51 pence

per Ordinary share. The loss includes exploration provision of £657,294 in The
Gambia.



Outlook

There is a continual need to assess the funding requirements of the Company.
The management team, along with its advisers, are reviewing a range of financing
options for 2003. Intensive effort has led to the five 3D seismic surveys

which I referred to earlier being acquired from November 2002 to February 2003
in Croix du Sud (AGC), Dome Flore (AGC), Ntem (Cameroon) and Iris and Themis

(Gabon). These surveys, as well as that obtained earlier in 2002 in Cheval Marin
(AGC) can reasonably be expected to deliver a large portfolio of drill-ready
prospects and, as such add substantial value to Fusion's licences.



Along with the deal already done with Amerada Hess in Croix du Sud and Ntem, the
intention is to actively pursue the early expressions of interest in a farmin to
our Gabon licences. The current world geopolitical situation and the insatiable
thirst of industrialised nations for readily accessible reserves, in West Africa
in particular, augur well for the market appeal of Fusion's widespread acreage
in the region. We expect continuing interest in our portfolio to be underpinned
by an increasing awareness by many medium and large oil companies that their
investment in exploration over the last 5 to 10 years has been neglected and
needs to be redressed.



Our aim is to deliver a busy schedule of high impact wells over the next couple
of years with Fusion being carried for most, if not all, of the drilling costs.
Fusion's equity in these wells will be substantially larger than in those that
have already been successful in Mauritania and this will have the potential to
add proportionally greater value per share.



Peter Dolan
Chairman



25th March 2003



Consolidated Profit and Loss Account

Interim Results to 31 December 2002
                                                                                                                        
                                              
                                                               6 months to     6 months to     Year ended  
                                                           31 December 2002    31 December        30 June  
                                                                          £            2001           2002 
                                                                                          £              £ 
            Operating loss                                         (581,358)       (516,533)    (1,216,512)
            Interest receivable and other income                      85,097         189,188        296,163
            Loss on ordinary activities before taxation            (496,261)       (327,345)      (920,349)
            Tax on loss on ordinary activities                             -               -              -
                                                                                                           
            Loss on ordinary activities after taxation             (496,261)       (327,345)      (920,349) 
            Loss per ordinary share                                                                        
            - basic                                                  (0.51)p         (0.35)p        (0.99)p
            - diluted                                                (0.51)p         (0.36)p        (1.02)p
                                                                              
                                         
 Consolidated Balance Sheet          

 Interim Results to 31 December 2002 
                                                                                                               
                                                            31 December 2002    31 December 2001      30 June  
                                                                           £                   £          2002 
                                                                                                             £ 
        Fixed assets                                                                                           
        Intangible exploration and appraisal expenditure            9,954,297           4,626,757     6,776,109
        Tangible assets                                               154,627             210,072       174,327
                                                                   10,108,924           4,836,829     6,950,436
        Current assets                                                                                         
        Debtors                                                        57,460              76,555        63,185
        Investments                                                         -           6.070,989             -
        Cash at bank                                                2,834,823           1,009,651     4,527,311
                                                                    2,892,283           7,157,195     4,590,496
        Creditors (amounts falling within one year)                                                            
        Creditors                                                     221,824             154,164       259,484
        Net current assets                                          2,670,459           7,003,031     4,331,012
        Total assets less current liabilities                      12,779,383          11,839,860    11,281,448 
        Share capital and reserves                                                                             
        Called up share capital                                       982,053             926,121       930,808
        Share premium account                                      17,046,313          15,073,457    15,103,362
        Profit & loss account                                     (5,248,983)         (4,159,718)   (4,752,722)
        Equity Shareholders' funds                                 12,779,383          11,839,860    11,281,448
                                                                              
                                         

 Consolidated Cash Flow              

 Interim Results to 31 December 2002 
                                                                                                                      
                                           6 months to 31 December     6 months to 31 December     Year ended 30 June  
                                                              2002                        2001                   2002 
                                                                 £                           £                      £ 
  Net Cash in/(out)flow from operating                       70,064                 (1,227,443)            (1,242,920)
  activities (see note 1)                                                                                             
  Returns on investing & servicing of                                                                                 
  finance                                                                                                             
  Interest received                                          85,097                     189,188                296,163
  Capital Expenditure & Financial                                                                                     
  Investment                                                                                                          
  Purchase of tangible assets and                       (3,841,845)                 (1,885,321)            (4,564,740)
  expenditure on exploration                                                                                          
  Cash outflow before use of liquid                     (3,686,684)                 (2,923,576)            (5,511,497)
  resources & financing                                                                                               
  Management of liquid resources                                                                                      
  Cash withdrawn from deposit                                     -                   3,009,011              9,080,000
  Net cash inflow from management of                              -                   3,009,011              9,080,000
  liquid resources                                                                                                    
  Financing                                                                                                           
  Net proceeds from share issues (net                     1,994,196                       5,269                 39,861
  of capital raising costs)                                                                                           
                                                                                                                      
  Net cash Inflow from financing                          1,994,196                        5,269                 39,861 
                 
  (Decrease)/Increase in cash for the                    (1,692,488)                      90,704              3,608,364 
  period                                                                                                              
                                                                                                                      
  Note to the Consolidated Cash Flow                                                                                  
  Note 1                                                                                                              
  Reconciliation of operating loss to                                                                                 
  net cash in/(out)flow from operating                                                                                
  activities                                                                                                          
                                            6 months to 31 December   6 months to 31 December     Year ended 30 June  
                                                              2002                        2001                   2002 
                                                                 £                           £                      £ 
  Operating Loss                                          (581,358)                   (516,533)            (1,216,512)
  Depreciation charges                                       29,515                      22,576                 61,488
  Exploration write offs and provisions                     657,294                           -                107,545
  (Decrease)/Increase in creditors                         (41,112)                   (696,096)              (171,421)
  (Increase)/Decrease in debtors                              5,725                    (37,390)               (24,020)
  Net cash in/(out)flow from operating                                                                                
  activities                                                70,064                 (1,227,443)           (1,242, 920) 




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