Apex to Benefit from Alaska Governor's Offer

Apex Resources Group reports that the Company could benefit significantly by the recently announced offer made by Alaska Governor Frank Murkowski to buy a stake in the proposed Alaska Natural Gas Pipeline which could provide approximately 7% of U.S. gas needs. Alaska's North Slope, potentially holds as much as 100 trillion cubic feet of gas, including more than 30 trillion proven cubic feet of gas re-injected back into oil reservoirs in Prudhoe Bay.

The Canadian Beaufort Sea Area, which borders Alaska's North Slope, is estimated by the National Energy Board, to contain total reserves of 1.01 billion barrels of oil and 9.00 trillion cubic feet of gas. In June 1997, Apex Resources Group Inc. purchased a 3.745% working interest in the Beaufort Sea Area Well known as Itiyok 1-27 consisting of 640 acres containing reserves of 108 Billion cubic feet of gas and recoverable oil reserves of 8.9 MM barrels of oil.

Earlier this year Apex Resources received correspondence from Imperial Oil Resources outlining proposed revisions to the Beaufort Sea Operating Agreement intended to simplify and clarify the agreement for future operations. Management reviewed the proposed revisions and agreed with the general principals. Apex operating partners in the Beaufort Sea Project are:

Apex Resources Group Inc.
Anadarko Canada Corporation
BP Canada Energy Resources Company BP PLC
BRL Enterprises Inc.
Canalands Resources Corporation
Chevron Canada Resources
CanNat Resources Inc.
ConocoPhillips Canada Resources Corp.
Canadian Forest Oil Ltd.
Devon ARL Corporation
EnCana Oil & Gas Partnership
ExxonMobil Canada Properties
Imperial Oil Resources
Mosbacher Operating Ltd.
Shell Canada Limited
Talisman Energy Inc.
Trans Dominion Energy Corp.
677862 Alberta Ltd.

These are significant discoveries and the need to transport these reserves via a pipeline through Canada to the Southern States is paramount. An 8,000 page application has been filed with regulators by a consortium to build a $7 Billion Pipeline down the Mackenzie Valley. The consortium consists of Imperial Oil Resources, ConocoPhillips, Shell Canada Limited and the Aboriginal Pipeline Group. Within days of this application being filed, the US Congress approved $18 Billion of loan guarantees to construct a $20 Billion pipeline to transport gas from Alaska via Canada to the lower 48 States.

John Hickey, Apex Director, commented, "Alaska's bid for a stake in the pipeline certainly reinforces our belief in the value of the Apex's Beaufort Sea holdings and the future of domestic oil and gas production. The acceptance of this offer would greatly benefit Apex and its operating partners in spearheading our efforts and bring long-term significant value to our shareholders."

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