The Kilgore Properties consist of mainly 100% working interests in oil properties in Gregg and Rusk Counties, approximately 25 miles from the Corporation’s existing base of operations in East Texas.  The properties include 34 wells, of which 3 are on production producing approximately 10 barrels of oil per day.

The Kilgore Properties are estimated to have a total of 280,000 barrels of remaining proved oil reserves, located on ten leases. Using a flat $75.00 crude oil price, these reserves are estimated to have undiscounted future net cash flows of $11.4 million, or, using a 9% discount rate, discounted future net cash flows of US$5.5 million.  Today, the Corporation completed the purchase of five of the ten leases, having an estimated 93,100 barrels of remaining proved oil reserves.  On these five leases, 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 $2.0 million.  The Corporation paid US$290,000 for the purchase of these five leases, and assumed abandonment retirement obligations associated with the leases estimated to have a present value of US$119,349.

The Corporation will continue to evaluate the title and environmental aspects of the remaining five leases, expecting their purchase to close in about one month, subject to there being no defects in title or unusual abandonment retirement obligations.  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.

Greater information about the oil reserves of the Kilgore Properties will be made available as part of the Corporation’s annual reserves data filings, expected in September, 2010.  Please note that the estimates of reserves and future net revenue for individual properties may not reflect the same confidence level as estimates of reserves and future net revenue for all properties owned by the Corporation due to the effects of aggregation, and the estimated values disclosed herein do not represent fair market value.

Forward looking statements:

Statements included herein, including those that express management’s expectations or estimates of our future performance, constitute “forward-looking statements” within the meaning of applicable securities laws.  Forward-looking statements are  based on assumptions and estimates that are subject to various risks and uncertainties including the risks disclosed under the heading “Business Risks” in the Corporation’s periodic filings on SEDAR, for example, in its Management Discussion and Analysis for the annual exercise ended June 30, 2009. Such information contained herein represents management’s best judgment as of the date hereof based on information currently available. The Corporation does not assume the obligation to update any forward-looking statements.

“Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.”

The Corporation had already obtained an increase in the borrowing base on its “Line of Credit” with Park Cities Bank of Dallas, Texas, to US$2.2million, announced on June 10, 2010.  The Line of Credit has a maturity date of October 1, 2011 and bears interest equal to the WSJ Prime Rate plus 1.5%, but no less than 6.5% per annum. To induce Park Cities Bank to provide the Line of Credit, the Corporation’s CEO, Chip Langston, and a director, Steve Hood, have agreed to provide personal guarantees on the loan (the “Guarantee”), underscoring their commitment to the growth and success of the Corporation.

In consideration of the Guarantee, Messrs. Hood and Langston shall each be paid 2% of the potential borrowing base of the US$2.2 million Line of Credit, for the period from July 1, 2010 to July 1, 2011.  Withdrawals from the Line of Credit are at the sole discretion of the Corporation during this period.  The Guarantee agreement with Messrs. Hood and Langston is a non-arm’s length transaction, and is subject to TSX Venture Exchange approval.

The Corporation expects to raise between $1,000,000 and $3,000,000 in the private placement through the issuance of Units issued at a price of $0.30.  Each Unit shall consist of one common share of the Corporation and one-half warrant.  Each warrant will entitle its holder to purchase one common share of the Corporation for $0.50 for a period of 18 months following the closing of the financing.   The financing is subject to TSX Venture Exchange approval.

The Gulftex Property consists of mainly 100% working interests in Wood County adjacent to the Corporation’s existing properties in the area.   The property includes 8 wells, of which 4 are on production currently producing approximately 15 barrels of oil per day.   The effective date of the purchase of the property is May 1, 2010, and the price paid for the property is US$190,000 plus the assumption of any abandonment retirement obligations associated with the property, estimated to have a net present value of US$88,083 assuming annual cost inflation of 3% and using a discount rate of 10% per annum to discount back to present value.

In a report entitled “Evaluation of Reserves Attributable to Gale Force Petroleum In Gulftex Field, Wood County, Texas, prepared as at May 1, 2010, the reserves of the Gulftex Property were estimated by an independent qualified reserves evaluator, Waterson Calhoun, P.Eng., of Crest Engineering Services, using a 10% discount rate, to have proved reserves of 19,820 net barrels of oil with a net present value of US$180,000, possible reserves of 45,160 net barrels of oil with a net present value of US$707,000 for total reserves of 64,990 barrels of oil with a net present value of US$888,000.  The Corporation also believes there may be additional, unevaluated reserves on some of the leases.

Further withdrawals from the line of credit also require the Corporation to have oil price hedges in place on 60% of its proved developed producing production, mitigating the risks of the increase in debt and providing the Corporation more predictable cash flows, but increasing the cost of capital of further withdrawals.  The Corporation already has some hedges in place, as announced on May 14, 2010.

The newly available funds may be used by the Corporation for the contemplated purchase and development of either of the Kilgore Property or Wood County Property, announced by the Corporation on June 2, 2009, or for the development of its existing properties.

The first contemplated purchase is of mainly 100% working interests in oil properties in Gregg and Rusk Counties, in Texas (the “Kilgore Property”) for US$500,000.  The Kilgore Property is 25 miles from the Corporation’s existing properties in East Texas.  The Kilgore Property includes 34 wells, 3 of which are currently on production, producing approximately 10 barrels of oil per day.

The second contemplated purchase is of mainly 100% working interests in Wood County, adjacent to the Corporation’s existing properties (“Wood County Property”), for US$190,000.  The Wood County Property includes 15 wells, of which 4 are currently on production, currently producing approximately 15 barrels of oil per day.

The purchase of the working interests in the Kilgore Property and/or Wood County Property are subject to due diligence, and subject to new financing, and would be expected to close around the mid to end of June, 2010.

•    Mr. Joseph F. “Chip” Langston (59) has been hired as the President and Chief Executive Officer of the Corporation, and also nominated as a Director.  Mr. Langston has over 30 years experience in executive and operational management in the public and private oil and gas companies.

•    Mr. Michael McLellan (32), who led the Corporation’s restructuring, will continue to serve as the Corporation’s Executive Chairman of the Board.

•    Mr. Steve Hood (59) has been nominated a Director of the Corporation.  Mr. Hood is a professional director, having throughout his career helped grow small private and public companies in to large companies, mainly in the insurance, healthcare and investments industries.

•    Mr. John Trosclair P. Eng (53) has been nominated a director of the Corporation. Mr. Trosclair is a petroleum engineer with over 30 years of oil and gas exploration and operational experience, as on oil and gas company owner, manager and as a drilling and completions engineer.

“Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.”

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TRANSACTIONS SUMMARY

The Transactions are summarized as follows:

• The Corporation has acquired the Buccaneer Assets, the Wells Ranch working interest and the Pine Mills working interests, which are oil and gas properties and assets located in Texas, Oklahoma and Tennessee.

• The Corporation has concluded a private placement financing, with gross proceeds of CA$1,741,500 through the issuance of 6,966,000 Units at $0.25 per Unit. Each Unit is comprised of one common share and one half of a Warrant with an exercise price of $0.375 expiring on April 29, 2011. In connection with the private placement, the Corporation issued 114,500 Units and paid $106,250 in finder’s fees to finders who are at arm’s-length to the Corporation.

• The Corporation has concluded a Debt Forgiveness and Conversion transaction with respect to its CA$1,830,281 secured loan to forgive CA$980,281 of the loan and convert the balance into equity securities of the Corporation.

• Subject to TSX Venture Exchange approval, the Corporation amended its stock option plan and issued stock options under the new plan. The amended stock option plan would permit the Corporation to issue up to 1,500,000 options, which is less than 10% of shares of the Corporation issued and outstanding. The Corporation has also issue options to Directors and Officers to purchase an aggregate 1,376,000 shares of the Corporation at a price of $0.33, which expire on May 15, 2015.

CAPITAL STRUCTURE

The Corporation has issued common shares, preferred shares, warrants and options, to conclude the Transactions, which are described in the table below. Also, to correct an omission in issuance of shares under the Proposal to Creditors, completed by the Corporation in August, 2009, the Corporation has issued 1,510 common shares of the Corporation to a creditor under the terms of the Proposal to Creditors. The table below sets forth the capital structure of the Corporation as of today:

HEDGING

To hedge the risks associated with a decline in oil prices, and to help ensure that the Corporation has adequate revenues to cover overhead and service its debts, the Corporation has purchased “floors”, consisting of a series of put options, costing a total US$80,100, for 1000 barrels per month of crude oil at US$70.00 per barrel, for 18 months, from June 2010 to November 2011.

Forward looking statements: Statements included herein, including those that express management’s expectations or estimates of our future performance, constitute “forward-looking statements” within the meaning of applicable securities laws. Forward-looking statements are based on assumptions and estimates that are subject to various risks and uncertainties including the risks disclosed under the heading “Business Risks” in the Corporation’s periodic filings on SEDAR, for example, in its Management Discussion and Analysis for the annual exercise ended June 30, 2009. Such information contained herein represents management’s best judgment as of the date hereof based on information currently available. The Corporation does not assume the obligation to update any forward-looking statements. “Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.” – 30 -

Full details of the Transactions are described in a detailed disclosure document, published yesterday on SEDAR (the “Filing Statement”).  The Transactions will be completed after the Corporation receives the final TSX Venture Exchange bulletin announcing the acceptance of the Transactions.

TRANSACTIONS SUMMARY

The Transactions are summarized as follows:

•    The acquisition of the Buccaneer Assets, the Wells Ranch working interest and the Pine Mills working interests, which are oil and gas properties and assets located in Texas, Oklahoma and Tennessee (greater details of these asset purchases are provided below).

•    A private placement financing, with gross proceeds of CA$1,741,500 through the issuance of 6,966,000 Units at $0.25 per Unit.  Each Unit is comprised of one common share and one half of a Warrant with an exercise price of $0.375 expiring on April 29, 2011.  In connection with the private placement, the Corporation issued 114,500 Units and paid $112,500 in finder’s fees to finders who are at arm’s-length to the Corporation.

•    A Debt Forgiveness and Conversion transaction with respect to the Corporation’s CA$1,830,281 secured loan t forgive CA$980,281 of the loan, convert CA$400,000 into 1,600,000 common shares of the Corporation at a price of twenty-five cents (CA$0.25) per share; and convert the balance of CA$450,000 into 1,800,000 Series I Preferred Shares, convertible into up to 1,800,000 common shares of the Corporation;

ASSET PURCHASE DETAILS

Certain details concerning the terms of the oil and gas property and asset purchases have been modified since they were previously disclosed.

Please note that the definitions of “proved reserves”, “proved developed reserves”, “proved developed non-producing reserves”, “proved undeveloped”, “probable reserves” and “possible reserves” used herein are consistent with the Canadian Oil and Gas Evaluator’s Handbook in compliance with Canadian National Instrument 51-101.  Please also note that the estimates of reserves and future net revenue for individual properties may not reflect the same confidence level as estimates of reserves and future net revenue for all properties, due to the effects of aggregation, and the estimated values disclosed herein do not represent fair market value.

The three property asset acquisitions the Corporation would purchase are as follows:

(1)    Wells Ranch. GFP would take ownership of a 100% working interest with an 80% net revenue interest in the Wells Ranch Property, an oil property located in East Texas with 6 non-producing wells on 1,200 gross acres (1,200 net acres).

In a report entitled “Evaluation of Reserves Attributable to Gale Force Petroleum in J.C. Wells Field, Wood County, Texas” prepared as at December 1, 2009, the reserves of the Wells Ranch Property were estimated by an independent qualified reserves evaluator, Waterson Calhoun(3), P. Eng., of Crest Engineering Services, as set forth in the following table:

———————————————————-
(1)    The reserves were estimated using NYMEX (WTI) prices of US$76.72 for 2009, US$81.08 for 2010 and US$85.71 for 2011, held constant thereafter, with a price differential of -US$15.00 per barrel for Sub Clarksville production and -US$3.50 for Paluxy production, such differentials being held constant for the life of the reserves.
(2)    All reserves quantities are undiscounted estimates; only the net present values of future net revenues in the last column of the table are discounted estimates.
(3)    Waterson Calhoun, P.Eng, is a consultant to GFP who works regularly with GFP to evaluate reserves and operations on its properties.

The purchase price for the Wells Ranch Property is US$100,000 in cash and CA$100,000 to be paid through the issuance of 400,000 Common Shares at a price of CA$0.25 per share.

GFP shall also assume abandonment and retirement obligations on the property, estimated to have a present value of US$97,531 (CA$102,664), which is the estimated future cost of abandonment and rehabilitation costs on the property assuming annual cost inflation of 3%, and using a discount rate of 10% per annum to discount back to present value.

The vendor of the Wells Ranch Property working interests acts at arm’s-length to GFP.

(2)    Pine Mills Assets. GFP would take ownership of a 75.5% working interest with a 60.40% net revenue interest in the Pine Mills Property, an oil property in East Texas with 27 non-producing well bores on 900 gross acres (680 net acres would be attributable to GFP).  Up to 25.5% of the 75.5% working interest may be re-purchased by the prior owner (as described below).

In a report entitled “Evaluation of Reserves Attributable to Gale Force Petroleum in Pine Mills Field, Wood County, Texas” prepared as at December 1, 2009, the reserves of the Pine Mills Property were estimated by an independent qualified reserves evaluator, Waterson Calhoun, P.Eng., of Crest Engineering Services, as set forth in the following table:

———————————————————-
(1)    The reserves were estimated using a discount rate of 10%, using NYMEX prices of US$76,72 for 2009, US$81,08 for 2010 and US$85,71 for 2011, held constant thereafter, with a price differential of -$18.39 per barrel, such differentials being held constant for the life of the reserves.
(2)    All reserves quantities are undiscounted estimates; only the net present values of future net revenues in the last column of the table are discounted estimates.

The purchase price to be paid for the Pine Mills Property is the assumption of up to an estimated US$531,959.01 in short-term trade payables, of which US$331,959.01 are secured trade payables and the balance are unsecured trade payables.

GFP would also assume abandonment and retirement obligations on the property, estimated to have a present value of US$108,609 (CA$114,323), which is the estimated future cost of abandonment and rehabilitation costs on the property assuming annual cost inflation of 3%, and using a discount rate of 10% to discount back to present value.

GFP would take possession of the 75.5% working interest that was acquired by Buccaneer from Hammerhead Investment Partners (“Hammerhead”) pursuant to a joint venture and assignment agreement signed between Hammerhead and Buccaneer with the consent of GFP as of November 5, 2009.  As per this agreement Buccaneer acquired a 75.5% working interest in the Pine Mills Property, of which Hammerhead had the option to re-purchase from Buccaneer up to 25.5% of the working interest by paying certain cash and other consideration to Buccaneer by January 15, 2010.

Hammerhead has attempted to exercise its option to re-purchase a working interest of the Pine Mills; however, Buccaneer and GFP have taken the position that it failed to provide adequate consideration to re-purchase a 25.5% working interest.  As of the date hereof, the matter remains unresolved, and Buccaneer and GFP believe that there is a significant likelihood that the dispute will result in the matter being referred to arbitration by a single arbiter in the State of Texas, which was the agreed upon method for resolving disputes under the November 5, 2009 agreement.

The vendor of the Pine Mills Property working interests, Hammerhead, acts at arm’s-length to GFP.
(3)    Buccaneer Assets.  GFP would take ownership of the “Buccaneer Assets”, comprised most significantly of a 95.0% Net Profit Interest in certain Central Oklahoma Properties which include 4 producing wells and 13 on-producing wells, and a 20% working interest in a non-operated property in Tennessee, which includes 4 producing wells, for a total purchase of the benefits to the oil and  natural gas minerals rights from 5,970 gross acres (2,620 net acres), on which there are 8 producing wells and 13 non-producing wells.

The Buccaneer Assets also include operating equipment, including one workover rig, current assets of US$190,242 (CA$200,255) as at December 31, 2009, and a Buccaneer Operating, LLC, a wholly-owned subsidiary of Buccaneer, which holds no assets but is the registered entity that operates Buccaneer’s properties in Texas.

An evaluation of the Buccaneer Asset properties by an independent qualified reserves evaluator, Michele K. Mudrone, P.Eng, of MKM Engineering, in a report entitled “Appraisal of Certain Oil and Gas Properties Owned by Buccaneer Energy Corporation Located in Oklahoma, Tennessee, and Texas” prepared as at October 1, 2009, using a discount rate of 10%, and using NYMEX prices until 2019, with prices held constant thereafter, found that Buccaneer’s properties have proved reserves of US$8,901,210.

A summary of the Buccaneer Assets reserves are set forth in the following table:

———————————————————————————-
(1)    The reserves were estimated using NYMEX (WTI) prices of US$70. 27 for 2009, US$70.94 for 2010 and US$75.76 for 2011, etc., to 2019, with a price adjustment to the NYMEX prices that is indexed to the monthly average of the daily closing prices received on the properties at the Cushing, Oklahoma delivery point.
(2)    All reserves quantities are undiscounted estimates; only the net present values of future net revenues in the last column are discounted estimates.

Although GFP would hold a 95% Net Profit Interest in the Central Oklahoma Properties upon closing of the Transactions, GFP shall be responsible for 100% of capital expenses on the Central Oklahoma Properties, and shall have the sole and exclusive right to approve capital expenditures, including any completion, drilling deepening, recompletion, rework or sidetracking on the properties.  GFP shall also have the right to approve any sub-contractors or suppliers used in the operating of the properties.

Additionally, upon closing of the Transactions GFP would also be granted the option by Buccaneer to purchase the 100% working interest in the Central Oklahoma Properties for US$100.00, for a period of ten years.

Summary of Historical Financial Statements of Buccaneer

The following table sets forth summary historical financial information regarding Buccaneer:

________________________________________
(1)    These liabilities are composed of an US$180,000 (CA$189,474) account payable and US$200,618 (CA$211,176) in related party advances to Buccaneer from Joseph F. Langston Jr.   These liabilities shall be repaid at closing through the issuance of 757,895 Common Shares to discharge US$180,000 (CA$189,474) of liabilities and 844,706 Preferred Shares convertible into up to 844,706 Common Shares to discharge US$200,618 (CA$211,176) in liabilities.
(2)    Of these related party advances, which are advances without interest or term to repayment, it is intended that US$78,926 shall be repaid in cash shortly after closing.
(3)    The impairment charges for both period presented in the table were recognized to adjust the value of Buccaneer’s Assets to equal the purchase price for the Acquisition of the Buccaneer Assets as described herein.

Acquisition Price & Assumed Liabilities
The total Purchase Price for the Buccaneer Assets is CA$2,891,173, to be paid by GFP as follows:

a)    Up to 5,465,136 Common Shares shall be issued to Buccaneer at a price of CA$0.25 per share for a total issuance value of CA$1,366,281, of which a balance of sale of 1,200,000 Common Shares with a value of CA$300,000 shall not be issued until certain conditions are met post-closing; and
b)    GFP shall assume CA$1,524,889 (US$1,448,645) in Assumed Liabilities of Buccaneer, of which CA$400,651 (US$380,618) shall be paid down through the issuance of GFP securities at the closing, as described below under “Debt Reduction”.

Debt Reduction
In addition to the securities issued in payment of the Purchase Price, simultaneously with the closing, GFP shall issue CA$400,651 of its securities to liability-holders of Buccaneer to pay down CA$400,651 (US$380,618) of liabilities as follows:

(a)     757,895 Common Shares at a price of CA$0.25 for a total issuance value of CA$189,474, to pay down a US$180,000 account payable of Buccaneer;
(b)     844,706 Series I Preferred Shares for a total issuance value of CA$211,177, such Series I Preferred Shares being convertible into up to 844,706 Common Shares, to pay down US$200,6118 in shareholder advances of Buccaneer; and
(c)     422,353 Warrants, with no value assigned, as they are being issued along with the other securities.

This debt reimbursement will reduce the total debt levels of GFP assumed from Buccaneer at the closing to approximately US$1,068,027 (CA$1,124,239), which is calculated as US$1,448,645 (CA$1,524,889) total liabilities of Buccaneer as at December 31, 2009, less the US$380,618 (CA$400,651) that shall be repaid and discharged by the issuance of Common Shares, Series I Preferred Shares and Warrants at closing.

STOCK OPTION PLAN

The Corporation shall amend its stock option plan and issue stock options under the new plan.  The amended stock option plan would permit the Corporation to issue up to 1,500,000 options (post-share-consolidation), which would be less than 10% of shares of the Corporation issued and outstanding following the closing of the Transactions. The Corporation would issue options to purchase an aggregate 1,376,000 shares of the Corporation at a price of $0.33, which expire on or about at latest on May 12, 2015.   The Amended Stock Option Plan and the issuance of options including the exercise price are subject to the approval or revision of the TSX Venture Exchange.

TRANSACTIONS SUMMARY

The table below sets forth the capital structure of the Corporation following closing of the Transactions:

Once the Transactions have been completed, management of the Corporation would consider the restructuring of the Corporation completed. The restructuring would result in the elimination of the Corporation’s secured loan, a substantial increase in the size and potential of the Corporation’s oil and gas reserves, and sufficient working capital and cash flow from operations to continue as a going concern.

Forward looking statements:

Statements included herein, including those that express management’s expectations or estimates of our future performance, constitute “forward-looking statements” within the meaning of applicable securities laws.  Forward-looking statements are  based on assumptions and estimates that are subject to various risks and uncertainties including the risks disclosed under the heading “Business Risks” in the Corporation’s periodic filings on SEDAR, for example, in its Management Discussion and Analysis for the annual exercise ended June 30, 2009. Such information contained herein represents management’s best judgment as of the date hereof based on information currently available. The Corporation does not assume the obligation to update any forward-looking statements.

“Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.”

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In connection with the private placement, the Corporation shall also issue 114,500 Units and pay $112,500 in finder’s fees to finders who are at arm’s-length to the Corporation.

Final approval from the TSX Venture Exchange will be granted when the Corporation meets various conditions including the filing on SEDAR of a full disclosure document providing all pertinent details about the purchase of substantially all the assets of Buccaneer Energy Corporation, as announced on February 10, 2010. Upon obtaining final Exchange approval, the Corporation intends to close each of the transactions that were announced on February 10, 2010, now expected in approximately one week.

Forward looking statements:

Statements included herein, including those that express management’s expectations or estimates of our future performance, constitute “forward-looking statements” within the meaning of applicable securities laws.  Forward-looking statements are  based on assumptions and estimates that are subject to various risks and uncertainties including the risks disclosed under the heading “Business Risks” in the Corporation’s periodic filings on SEDAR, for example, in its Management Discussion and Analysis for the annual exercise ended June 30, 2009. Such information contained herein represents management’s best judgment as of the date hereof based on information currently available. The Corporation does not assume the obligation to update any forward-looking statements.