Africa Oil Third Quarter of 2012 Financial and Operating Results

Keith Hill, President and CEO, commented, “Africa Oil is very encouraged with the results of our first two exploration wells in the Lockichar basin. The arrival of an additional two drilling rigs will allow us to evaluate whether the Tertiary trend extends into southern Ethiopia and to test the Cretaceous rift in north-central Kenya.”

Third Quarter 2012 Financial and Operating Highlights

Operating expenses increased by $1.2 million for the three months ended September 30, 2012 compared to the same period in the previous year due mainly to a $1.7 million increase in stock-based compensation.

Operating expenses decreased by $0.9 million for the nine months ended September 30, 2012 compared to the same period in the previous year due to a $7.0 million impairment of intangible exploration assets relating to Blocks 2/6 in Ethiopia in the second quarter of 2011 and reduced office and general costs of $0.5 million. These reductions were offset partially by a $3.1 million impairment of intangible exploration assets relating to Blocks 7 and 11 in Mali in the first quarter of 2012, an increase in professional fees in the second quarter of 2012 associated with previously completed farmout transactions and an increase of $1.0 million in stock-based compensation costs relating to options issued in the third quarter of 2012.

The gain relating to the acquisition of Lion Energy Corp. (“Lion”) in the second quarter of 2011 was a result of the Company acquiring net working capital and intangible exploration assets in excess of the consideration issued. The consideration paid was valued at $21.7 million, net of AOC shares acquired, versus working capital acquired of $20.1 million, excluding the value of AOC shares held by Lion, and the fair market value of intangible assets acquired estimated at $5.7 million.

A $4.6 million dilution loss on the sale of a subsidiary was recognized during the third quarter of 2011 as a result of Africa Oil transferring its Puntland (Somalia) exploration assets to Horn. This transaction was recorded as a reverse acquisition.

Financial income and expense is made up of the following items:

The loss on revaluation of marketable securities is the result of a decrease in the value of 10 million shares held in Encanto Potash Corp. which were acquired as part of the acquisition of Lion. These shares were sold during the three months ended March 31, 2012.

At September 30, 2012, nil warrants were outstanding in AOC. The Company incurred a $17.3 million gain on the revaluation of Horn warrants during the third quarter of 2012 due to a significant decrease in the share price of Horn during the quarter.

The foreign exchange gains and losses are the direct result of changes in the value of the Canadian dollar in comparison to the US dollar. The Company’s cash holdings are primarily in US and Canadian currency.

The increase in total assets from December 31, 2011 to September 30, 2012 is primarily attributable to intangible exploration expenditures incurred during the quarter, a significant portion of which related to drilling of the Ngamia-1 and Twiga South-1 well in Kenya and the Shabeel-1 and Shabeel North-1 wells in Puntland (Somalia).

The decrease in cash in 2012 is mainly the result of intangible exploration expenditures and operating expenses offset partially by funds raised on the exercise of warrants, the non-brokered private placement completed by Horn and the proceeds from the Block 12A farmout to Tullow.

Outlook

The Ngamia-1 light oil discovery in the Lokichar sub-basin of tertiary rift on Block 10BB (Kenya) led to a significant increase in the pace of exploration. The Company and its joint venture partner Tullow sourced an additional two drilling rigs. One rig was mobilized to Block 10A (Kenya) in the quarter and commenced drilling the Paipai prospect and an additional rig is currently being mobilized to the South Omo Block (Ethiopia) to commence drilling the Sabisa-1 prospect. The Weatherford rig which drilled Ngamia-1 continued with drilling operations in the Lokichar sub-basin of the Tertiary Rift where the Twiga South-1 prospect has recently encountered oil. Drilling of Twiga South-1 is ongoing and an announcement on the well results is expected late-November after target depth has been achieved and necessary sampling and analysis has been completed. The Company expects to have three rigs operating in its Kenyan and Ethiopian acreage prior to the end of 2012.

Based on the encouragement provided by the Shabeel wells, the Company and its partners entered the next exploration period in both the Dharoor Valley and Nugaal Valley PSAs which carry a commitment to drill one well in each block within an additional three year term. The current operational plan is to contract a seismic crew to acquire additional data in the Dharoor Valley block and to hold discussions with the Puntland Government regarding drill ready prospects in the Nugaal Valley block. The focus of the Dharoor Valley block seismic program will be to delineate new structural prospects for the upcoming drilling campaign.

Africa Oil Corp. is a Canadian oil and gas company with assets in Kenya, Ethiopia and Mali as well as Puntland (Somalia) through its 45% equity interest in Horn Petroleum Corporation. Africa Oil’s East African holdings are in within a world-class exploration play fairway with a total gross land package in this prolific region in excess of 300,000 square kilometers. The East African Rift Basin system is one of the last of the great rift basins to be explored. Two new significant discoveries have been announced in the Lockichar basin in which the Company holds a 50% interest along with operator Tullow Oil plc. The Company is listed on the TSX Venture Exchange and on First North at NASDAQ OMX-Stockholm under the symbol “AOI”.

FORWARD-LOOKING STATEMENTS

Certain statements made and information contained herein constitute “forward-looking information” (within the meaning of applicable Canadian securities legislation). Such statements and information (together, “forward looking statements”) relate to future events or the Company’s future performance, business prospects or opportunities. Forward-looking statements include, but are not limited to, statements with respect to estimates of reserves and or resources, future production levels, future capital expenditures and their allocation to exploration and development activities, future drilling and other exploration and development activities, ultimate recovery of reserves or resources and dates by which certain areas will be explored, developed or reach expected operating capacity, that are based on forecasts of future results, estimates of amounts not yet determinable and assumptions of management.

All statements other than statements of historical fact may be forward-looking statements. Statements concerning proven and probable reserves and resource estimates may also be deemed to constitute forward-looking statements and reflect conclusions that are based on certain assumptions that the reserves and resources can be economically exploited. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as “seek”, “anticipate”, “plan”, “continue”, “estimate”, “expect, “may”, “will”, “project”, “predict”, “potential”, “targeting”, “intend”, “could”, “might”, “should”, “believe” and similar expressions) are not statements of historical fact and may be “forward-looking statements”. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. The Company believes that the expectations reflected in those forward-looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct and such forward-looking statements should not be unduly relied upon. The Company does not intend, and does not assume any obligation, to update these forward-looking statements, except as required by applicable laws. These forward-looking statements involve risks and uncertainties relating to, among other things, changes in oil prices, results of exploration and development activities, uninsured risks, regulatory changes, defects in title, availability of materials and equipment, timeliness of government or other regulatory approvals, actual performance of facilities, availability of financing on reasonable terms, availability of third party service providers, equipment and processes relative to specifications and expectations and unanticipated environmental impacts on operations. Actual results may differ materially from those expressed or implied by such forward-looking statements.

ON BEHALF OF THE BOARD

Keith C. Hill, President and CEO

Africa Oil’s Certified Advisor on NASDAQ OMX First North is Pareto Ohman AB.

Neither the TSX Venture Exchange nor its Regulation Services Pareto Provider Ohman (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.