Deep Well Oil and Gas (fka DWOG)

[Talc Moan]

Love how only 5 of the 8 wells approved will bring us to 3200 bopd... Imagine all 8 going.. That would increase prob over 5,000 if they ever wanted to..

In late July of 2013 we entered into a Steam Assisted Gravity Drainage Demonstration Project Joint Operating Agreement (the “SAGD Project”) where we have a 25% working interest with one joint venture partner. In late July of 2013 we entered into a farmout agreement (the “Farmout Agreement”) with an additional joint venture partner (the “Farmee”). The SAGD Project produced bitumen for 18 months, demonstrating the productive capability of our Sawn Lake reservoir. In 2016 a majority of our Company’s Joint Venture partners voted to temporarily suspend operations for the SAGD Project. In early May of 2016, an amended application was submitted to the AER for an expansion of the existing SAGD Project facility site which would potentially increase the operations up to a total of eight SAGD well pairs. The amended application sought approval to expand the current SAGD Project facility site to 3,200 bopd (100% basis). Regulatory approval was received in December 2017 for a commercial expansion of the existing SAGD Project facility site where we have a 25% working interest. It is anticipated that only five SAGD well pairs will be needed to achieve the 3,200 bopd production level. For more information regarding our SAGD Project and our Farmout Agreement, see “Present Activities - Peace River Oil Sands, Alberta Canada (Sawn Lake Properties)” under Item 2 “Properties” of this Annual Report on Form 10-K.