Apex Resources Upbeat on New Report on Beaufort Sea Well

Apex Resources Group reports on updates to the Engineering Report on the Itiyok I-27 Well in the Beaufort Sea. On October 25, 2005 Citadel Engineering of Calgary released the report to reflect the current gas and oil prices.

In June 1997, Apex Resources Group purchased a 3.745% working interest in the Beaufort Sea Area known as the Itiyok 1-27 Well, which was drilled in 1983. A review of the well data and geological prognosis indicates that a 640 acre area would contain proven recoverable gas reserves of 108 Bscf and proven recoverable oil reserves of 8,976 MSTB working interest net reserves of 4.04 Bscf and 336 MSTB. Seismic data indicates a structure closure of approximately 40 square KM with a gross potential reserve of 1.16 TCF and 160 MMSTB (working interest net - 34 Bscf and 4.7 MMSTB). The lands in which the Apex Resources Group Inc. owns an interest comprise of 21.54 square KM containing gross potential reserves of 625 Bscf of gas and 86 MMSTB of oil (working interest 23.4 Bscf of gas and 3.2 MMSTB of oil).

With oil at approximately US$60.00 per barrel and gas close to US$12.00 per cubic feet, Apex interest in proven reserves would be US$68.640 million and with an additional potential to be drilled out would represent US$1.231 billion.

This will be a tremendous asset to Apex if and when the Mackenzie Valley Pipeline is completed.

The following proven, probable and possible gas and oil reserves are taken from the Engineering report.

Without a decision on the pipeline Apex 3.745% of the Itiyok I-27 Well is reduced at US$2,895,000 for proven reserves. After a decision to move forward with the pipeline this value will increase significantly.

 Itiyok I-27

 Part 1 - Proven Gas & Oil Reserves: (640 acre area)
 Total: - A) 108 Bscf - Gas
          B) 8.976 MM STB - Oil

 Apex Working Interest - (3.745%)
   A) 4.04 Bscf - Gas @ US$12.00/ft3 = US$48.480 Million (Gas)
   B) 336,000 STB - Oil @ US$60.00/B = US$20.160 Million (Oil)
                                       US$68.640 Million (Gas & Oil)

 Part 2 - Probable Gas & Oil Reserves: (40 square KM)
 Total: - A) 1.16 TCF - Gas
          B) 160 MM STB - Oil

 Apex Working Interest - (3.745%)
   A) 34 Bscf-Gas @ US$12.00/cubic ft = US$408.000 Million (Gas)
   B) 4.7 MM STB - Oil @ US60.00/B    = US$282.000 Million (Oil)
                                        US$690.000 Million (Gas & Oil)

 Part 3 - Possible Gas & Oil Reserves: (21.54 square KM)
 Total: - A) 625 Bscf - Gas
          B) 86 MM STB - Oil

 Apex Working Interest - (3.745%)
 A) 23.4 Bscf-Gas @ US$12.00/cubic ft = US$280.800 Million (Gas)
 B) 3.2 MM STB - Oil @ US60.00/B      = US$192.000 Million (Oil)
                                        US$472.800 Million(Gas & Oil)
 Total of All 3                         US$1.231 Billion Gas & Oil