2010-08-31-2010-08-18-2010-08-18

Bought 100% WI in TX oil properties in Gregg & Rusk counties, gaining 93,100 proved, 10 BO/d.

Gale Force Petroleum Inc., Montreal, (Toronto Venture: GFP) has purchased a 100% interest in certain oil properties in Texas for US$290,000.

The purchased assets, dubbed the Kilgore properties, involve five out of 10 leases in Gregg and Rusk counties. The acquired properties are 25 miles existing Gale-Force operated properties in East Texas, and include 34 wells, three of which are currently producing approximately 10 barrels of oil per day.

The five leases have an estimated 93,100 barrels of remaining proved oil reserves. Using a flat $75 crude oil price, the reserves are estimated to have undiscounted future net cash flows of $3.9 million, or, using a 9% discount rate, discounted future cash flows of $2 million.

Gale Force has assumed abandonment retirement obligations associated with the leases estimated to have a present value of US$119,349. The remaining five leases have a total purchase price of US$210,000 and would require the assumption of abandonment retirement obligations estimated to have a present value of US$134,267.

Additionally, Gale Force plans to acquire a 100% working interest in certain oil properties in Wood County US$190,000. The Wood County property includes 15 wells, of which four are currently producing approximately 15 barrels of oil per day.

Gale Force has gas properties in Alberta and Kentucky.