Gulf Western Petroleum Corporation

Gulf Western Petroleum (“Gulf Western”) is focused on the exploration and development of domestic petroleum and natural gas reserves in the United States.  The Company currently has a strong portfolio of lease acreage projects in Texas, Kansas and Kentucky.  It is also actively seeking out additional oil and gas resource opportunities that would benefit from its range of core competencies.

Gulf Western was formed through a merger between Wharton Resources Corp., a development stage company with oil & gas lease acreage in Texas, Kentucky and Kansas, and of Georgia Exploration, Inc. 

Gulf Western’s primary asset is a high calibre management team with both upstream and midstream segment experience, as well as a proven track record of finding and developing commercial reserves.  Pursuant to the merger, the management team is comprised of W. Milton Cox as Chief Executive Officer, Bassam Nastat as President and Don Sytsma as Chief Financial Officer, Treasurer and Secretary.  This team has extensive experience in the U.S. oil and gas industry and the ability to attract a steady stream of high quality oil & gas resource opportunities.

Gulf Western has a strong portfolio of exploratory prospects.  All of these holdings are near existing infrastructure, providing ready access to major oil and gas markets and the ability to ramp up cash flow and future growth.  The Company also maintains a core group of relatively low risk gas leases which could lead to considerable asset and income growth.

Advanced Projects

This 866 acre property lies immediately to the north-northeast of the Southwest Bonus Field in North Central Wharton County, Texas.  It is ideally located in the central Gulf Coast Plain on the east side of the San Marcos Arch, and is surrounded by past and current production. The main target for hydrocarbon production is the Wilcox formation, with the Frio formation slated as secondary. 

• 95.75% working interest and a 73.0% net revenue interest.
• This project offers most significant immediate growth for Gulf Western.
• Net present value of proven, probable and possible (“3P”) reserves are valued at $110 million, based on discounted forward projected cash flow rate of 10% (“PV10”) (approx. $4.25 per share based on $5 natural gas and $50 per barrel condensate).
• Known airborne seepage anomaly (ASA) immediately north.
• Estimated gross natural gas and condensate reserves of approximately 2.68 Billion cubic feet and 66,900 barrels, respectively (Sproule Associates, Inc., Calgary, AB). Net reserves assigned per well are approximately 1.82 Billion cubic feet natural gas and 48,800 barrels condensate.
• Net “3P” natural gas reserve potential of 30.9 Bcf.
• Net associated “3P” condensate reserve potential of 830,000 barrels

Adjoining the Oakcrest Prospect, this wildcat 567 acres acreage is on trend, sharing the same ASA identified in a 1992 survey that located four anomalies.  To date, three of the four anomalies have resulted in commercial discoveries.

• Upon acquisition of the lease acreage the Company would hold a 100.0% working interest and a 75.0% net revenue interest.
• Exploration is in the preliminary stages.
• Area production comes from three zones: the Frio, Yegua and Wilcox (at 13,500 feet).
• Payback on a typical Wilcox well has been three to four months at just under $4 million per well.
• Based on anomaly size and 2D seismic analysis, this project has the potential for more than 800,000 barrels of oil and 20Bcf of gas.

With over 5,000 fields in production, total production of oil and gas in Kansas in 2005 equaled 33,587,566 barrels and 381,373,037 MCF respectively.

Gulf Western purchased this 8,800-acre infrastructure and reserve development project from Orbit Energy, LLC. for $6.8 million in debentures and common shares. 

• 100.0% working interest and 74.0% net revenue interest.
• Nine wells drilled and presently being tested.
• Planned $4 million, 15 mile, 8,000 mcf per day natural gas gathering system.
• Planned development drilling of 150 wells, with pipeline connecting to Enbridge interstate pipeline.
• Majority of wells expected to produce from Mulky and Summit coals at 1600 ft. depth.
• Upside exists in productive Mississippian and Arbuckle sections at 2200 – 2600 ft. depth.
• Mississippi known to produce from 100 mcfd to 3 Mmcf per day.
• Four point test on MT19-1 the first Mississippi well tested showed absolute flow at 1.4 mmcf gas per day.  72-hour test indicates will will be produced at 350 to 400 Mcfd.

Other Long-Term Projects

Shamrock Project
Dewitt County, Texas

• 90% working interest and 62.8% net revenue interest in three (3) wells.
• Initial well Jameson No. 1 permitted and location completed.
• Drilling to commence March 8, 2007.
  

• 3D data used to develop 10 prospects is same data shoot used that resulted in 10 out of 10 successful wells in previous prospects in same Brushy Creek Field.
• Company interest 31.5% working interest and 22.5% net revenue interest
• Wells will test amplitude anomalies with strong 3D seismic expressions, just as the previous 10 wells.
• Current wells averaging 250 – 300 Mcfgd.
• Est. ultimate recoverable reserves in next 10 wells totals 8.15 Billion cubic feet gas.
• Drilling to commence mid to late March 2007.

• 100.0% working interest and 72.0%% net revenue interest.
• Approximately 2,200 gross acres (1,584 net acres).
• Purchased from CodeAmerica for $330,000 for its oil and gas lease interests.
• Drilling on initial well to commence third quarter of 2007 in the Black River Group formation.
• Exploring/drilling Appalachian Basin natural gas supplies.

• 100.0% working interest and 72.0% net revenue interest
• Approximately 3,400 gross acres (2,448 net acres).
• Purchased from CodeAmerica for $255,000 plus reimbursement of $59,475 for land and legal services.
• Plans include title verification and confirmation process for the acquired acreage.