Arakis reports signing of supplemental agreement to the Sudan production sharing agreement.

CALGARY, Alberta--(BUSINESS WIRE)--Aug. 28, 1996--ARAKIS ENERGY CORPORATION reports that the Company, through its wholly owned subsidiary State Petroleum Corporation ("State"), has entered into an agreement with the Government of the Sudan, under which State will continue its exploration and development activities under the terms of the first commitment period of the Production Sharing Agreement ("PSA").

State, with cooperation from the Government of the Sudan, will seek to establish a consortium of companies to participate in the Sudan Petroleum Project. Based upon progress with prospective joint venture partners, the Government of the Sudan and State have agreed to a time table to negotiate Letters of Intent and make mutually beneficial amendments to the PSA, a process that could take three to six months.

Arakis is continuing its negotiations with prospective joint venture partners to provide the estimated US$ 927 million for the Phase I exploration, development and pipeline construction, inclusive of funds expended by Arakis to date. Start-up throughput for the pipeline is estimated at 150,000 barrels of oil per day.

CONTACT: Arakis Energy Corp., Calgary

David Harrison, 403/263-2471

403/263-8069 (FAX)

http:\\www.arakis.com