$50 Million Dollar- 51 Well Drilling Program on ACOR's ORRI under ATP-299 - Mulberry-12 Strikes Oil on the $5 Billion Dollar Potential Oil Field- Huckleberry-1 Spuds- Endeavour-11 Spuds.

CISCO, Texas -- Australian-Canadian Oil Royalties Ltd. (herein called ACOR) (OTCBB:AUCAF) reports that the JV partner of ATP-299 has announced the successful completion of Mulberry-12 as a Birkhead oil producer. Mulberry 12 was drilled at the Mulberry Field on ACOR's ORRI about 950 meters northwest of Mulberry 2. It encountered good oil shows with approximately 3-4 meters of net oil pay in the mid Birkhead reservoir unit and has been cased as a future oil production well.

Rig PDI-735 was then released to the Huckleberry 1 near field exploration (NFE) well location. Huckleberry 1 is located approximately 2 kilometers west of Mulberry 2, and spudded on May 21st. The total depth of the Huckleberry-1 is 1,365 meters.

The second drilling rig, PDI-724 continued drilling operations at the Endeavour field. Endeavour 11 spudded on May 19th. As of May 22nd, the surface casing had been set. Planned forward operations are to drill out the casing shoe conduct BOP tests and drill in 7 7/8" hole ahead to TD.

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 /Tintaburra Oil Field contain significant proved undeveloped oil reserves and exploration up side.

The Mulberry-Gimboola-Endeavour Field is part of the Tintaburra Oil Field on ACOR's ORRI under ATP-299. The Mulberry/Tintaburra Oil Field 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 Onshore Australia Working Interest 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 forthcoming press releases.

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.