Treaty Makes Headway at Tx. Leases

Treaty announced progress on its lease acquisitions in Texas and its Texas Energy Drilling LLC business.

Andrew V. Reid, Chairman & CEO of Treaty Energy Corporation, stated, "On Monday, June 6th, two major events took place that will have a positive impact on our Company. The first event was the filing of a $65,000 cash financial assurance bond with the Texas Rail Road Commission (RRC) for C & C Petroleum Management, LLC, a wholly owned subsidiary and the operating company for all of Treaty's wells and leases in Texas."

As of the posting of this bond with the RRC all P4's were filed on the existing leases, including the BARNES, LONG and HENDERSON leases. Treaty Energy's President, Stephen L. York, stated, "I expect the initial transfers to show up over the next several days on the RRC public access website. Treaty will then be allowed to sell the estimated 300-400 barrels of accumulated oil in our storage tanks. In addition, Treaty will ramp up and continue to produce and sell oil as our storage tanks are continually replenished."

Mr. Reid stated further, "The second major event was the completion of the $50,000 payment on the 'GREAT EIGHT LEASES' purchased from attorney Richard C. Houston, Jr., as was announced in a prior news release on May 23, 2011."

Mr. York stated, "I am getting all the assignments completed with the Texas RRC and filing the P4's to transfer operations to C & C Petroleum Management, LLC, Treaty's operations entity. As on the other leases, Treaty will start selling the current oil in the storage tanks after all of the assignments are completed."

Based on current production levels on the wells of the GREAT EIGHT LEASES and the estimated initial production on the BARNES, HENDERSON, and LONG leases, daily production is expected to be 30-40 barrels of oil per day. This will rapidly increase as Mr. York brings on more of the closed in wells on these leases.

Finally, Mr. York updated progress on the newly formed drilling company, Treaty Energy Drilling, LLC. Mr. York stated, "The initial intent of Treaty Energy Drilling LLC was to acquire a rig and start drilling new wells on the Treaty owned leases. This strategy has now been modified due to the success of our newly acquired rig being contracted to drill approximately one new well per week for independent oil companies, and obtaining contract commitments for the foreseeable future."

Based on these commitments to drill many wells for other oil companies, Mr. York is preparing to purchase a third rig (the second was purchased to drill in Belize) in the immediate future. The Company will announce when purchase documents are signed for this third rig for the Company's Texas drilling program.

In closing, Treaty Energy's CEO, Andrew V. Reid, stated, "I am beyond pleased with the progress in Texas and look forward to the final payment on the SHOTWELL leases that will add to the daily oil production from our Texas operations."

Mr. Reid stated further, "It is also expected that our purchase of the CLAVO leases that had been postponed until certain title issues were cleared should happen in the near future. We expect an update from the attorney for the CLAVO leases later this week as he expected to have the issues cleared up on or about June 7, 2011. I am disappointed by the delay, but understand the importance of having this acquisition completed properly."


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