Django 1.5 ImportError: No module named myproject.urls

Question

Im trying to get a project working locally, however when I try and $python manage.py runserver I get the error: ImportError: No module named myproject.urls

I am confident the project is set up properly I feel like something needs to be configured on my end, however I have not been able to solve it. The project structure looks like this

/root
  -requirements.txt
  /myproject
    -manage.py
    -urls.py
    /apps
    /settings
     -base.py 
     -local.py

settings/base.py

ROOT_URLCONF = "myproject.urls"

I have set my DJANGO_SETTINGS_MODULE=settings.local

We were on python 1.4 before and now since we moved to 1.5 I havent been able to get the enviro working locally, it is however, working live.