Wilpinnie 4 Well Strikes Oil - Flows Oil at Approximately 144 BOPD on PEL 115 on ACOR's ORRI in South Australia.

CISCO, Texas -- Australian-Canadian Oil Royalties Ltd. (herein called ACOR) (OTCBB:AUCAF) is pleased to announce that the PEL 115 joint venture group advises that the Wilpinnie 4 well has struck oil on ACOR's ORRI. The DST-1 at 4,842 to 4,878 feet, recovered approximately 24 barrels of oil during the main four hour flow period. This influx equates to a flow rate of approximately 144 BOPD.

The current operation was preparing to run 5 u inch production casing to total depth of 5,206 feet. Wilpinnie 4 will then be suspended as a cased well for completion and oil production testing of the mid Namur Jurassic oil sand at a later date.

The determination of the zone of the mid Jurassic Namur sandstone oil zone to be perforated and production tested through casing will be based on the detailed analysis of the wire line log and core data and Drill Stem Test results.

Initial analysis of the wire line logs, side wall core, FMT data and fluid samples indicates an oil zone of gross 59 feet in the mid Namur sandstone over the interval 4,842 - 4,901 feet with an interpreted oil water contact at 4,901 feet.

The DST-2 at 4,816 to 4,885 feet was a misrun, as the tool plugged immediately upon opening. Repeat formation testing near the base of the interpreted oil column at 4,898 feet recovered a sample of oil and mud filtrate.

A Core sample was taken from 4,829 to 4,878 feet, cut in the primary objective the Jurassic Mid Namur Sandstone.

The Tomcat (Wilpinnie) Prospect is interpreted from seismic data to have the possible potential to contain recoverable oil in the range of approximately 3.6 million barrels to 5.7 million barrels, if oil is present.

About PEL 115

PEL 115 on ACOR's ORRI consists of 273,297 gross acres and is divided into six (6) separate tracts. PEL 115 surrounds the oil & gas producing fields at Dullingari, Toolachee, Strzelecki, Della, and Kidman with cumulative recoverable reserves of approximately 104 million barrels of oil and approximately 2.5 TCF of gas or approximately $12.6 billion dollars using current market prices for crude oil and $US2.50 per mcf for gas.

The permit represents one of the lowest risk areas for exploration in the Cooper Basin. Initial studies of the available seismic data have identified several leads and prospects with the potential to contain commercial recoverable reserves of oil and gas, if oil and gas are present. The proximity to infrastructure suggests that the economic viability of any exploration success is assured.

A four well drilling program commenced in late August 2004 going through to mid December 2004. The first well, Hornet-1, defined by 3D seismic, encountering gas in the target Permian sands. Hornet-1 has been cased for production testing when a gas market has been identified.

Exploration drilling activity continued in the south-western part of PEL 115 with Ventura-1, where oil recoveries were made in the primary and secondary target sands, the Murta and Namur, with the Namur recovering oil at up to 352 barrels of oil per day.

Canberra-1 followed, testing a high risk but potentially high reward Permian sand stratigraphic gas trap, but hydrocarbons were not encountered.

The fourth well in the 2004 drilling program, Mirage-1, recovered oil from the Murta Formation on drill stem tests. PEL 115 Joint Venture commenced an Extended Production Test (EPT) in late April 2005 on Mirage-1 with a free flow rate of 274 barrels of oil per day.

During the year, the Mirage-1 and Ventura-1 wells in the South Australian Cooper Basin were put on long-term production, with production licenses being granted over both oil fields in August 2006.

Average combined gross production from the Mirage/Ventura oil fields for the past year was at a combined rate of 328 barrels of oil per day.

With the recent successful development drilling of Mirage-3 and Mirage-4 and fracture stimulation, we look forward to an increase in oil production from the Mirage Oil Field.

The interpreted recoverable oil reserve for the Mirage Oil Field using this information is a range of recoverable oil reserves from a mean of 1.3 million barrels up to a maximum of 3.6 million barrels, however; the interpretation of the 3D data set suggest that Mirage-1 could be part of a larger feature covering approximately 12 square miles. Such an area has the possibility of containing up to approximately 23 million barrels of oil in place, subject to the presence of suitable Murta sand reservoir on ACOR's ORRI.

ACOR owns 10% of 1% ORRI under PEL 115.

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 interests and overriding royalty interests 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.