Salt Lake City, Utah – December 7, 2007 – Apex Resources Group, Inc. (OTC BB:APXR) Announces ConocoPhillips, The Largest Oil Producer In Alaska, Has Proposed Spending Between $25 & $42 Billion To Build The Alaska Gas Pipeline, While Competing Plans To Build The Mackenzie Valley Gas Pipeline Are Also Being Revamped.

 

ALASKA GAS PIPELINE PROGRESS:

Apex Resources Group Inc. is pleased with the ConocoPhillips proposed building of the Alaska Gas Pipeline, the most costly ever in North America. The building of the pipeline enhances the need to develop one of America’s last great known resources, and will be a huge project for Alaska and a major source of energy for the rest of the United Stated for decades.

The North Slope has proven gas reserves of 35 trillion cubic feet, or about 13% of known US reserves, according to Department of Energy data. Geologist estimate there could be as much as 200 trillion cubic feet of undiscovered gas in Alaska. The pipeline would transport about 4 billion cubic feet of gas a day and would carry enough gas to meet 6.8 percent of the U.S. demand predicted by the federal Energy Department for 2025.

Present cost projections for the pipeline range from $25 billion to $42 billion with possibly $30 billion being the best estimate. This is a monumental project and a huge amount of gas. ConocoPhillips is interested in partnering with other Alaskan oil producers and a pipeline operator, but is prepared to make significant investments without state matching funds to advance the project.

 

MACKENZIE VALLEY GAS PIPELINE PROGRESS:

With the progress on the building of the Alaska Gas Pipeline, pressure is building to build the Mackenzie Valley Gas Pipeline. Currently, a deal that restructures the stalled Mackenzie natural-gas pipeline appears to be close at hand This would involve TransCanada Corp. and the Aboriginal Pipeline Group (APG) taking control away from a consortium of oil companies led by Imperial Oil Ltd.

The revamped proposal comes as competing plans to build the Alaska Gas Pipeline were launched by ConocoPhillips, Trans-Canada and others, injecting new life into that project. Alaska's progress provides impetus for the Mackenzie Valley Gas Pipeline project. Due to rapidly rising cost, the project has been in limbo for six months, it now appears the producers are prepared to step aside and let Trans Canada, Canada's largest pipeline company, take the lead with 60% ownership, with the remaining 40% going to the APG, a Calgary-based organization representing aboriginal groups in the Canadian North. The new partnership for the multi-billion-dollar project, will seek help from Ottawa in the form of loan guarantees, shipping commitments or other breaks.

Jim Prentice, the Canadian Federal Minister responsible for the project and the key stakeholders are scheduled to meet early December in Calgary, leading to a board meeting of the APG on Dec. 15, with hopes for an announcement by Christmas. It appears that the various parties are pretty close to a deal, with the role of the feds to be willing to do the loan guarantees still needing to be confirmed, and the producers are out. Conclusively, the pipeline would be owned 60% by Trans-Canada and 40% by APG.

Progress on the Mackenzie Valley Gas Pipeline project stalled last spring when the price tag swelled to $16.2 -billion, from $7.5-billion two years earlier, while Ottawa refused to give oil companies large incentives to improve the project's economics. The oil companies reacted by informing Ottawa the project was dead, and that they were considering the merits of the government owning the pipeline with TransCanada and the APG, with TransCanada being the builder. At that time, Ottawa backed away from the idea of becoming a part-owner and instead challenged the proponents to restructure the project. Even if the government provides some form of support to the new partnership, it may be more politically acceptable than aiding highly profitable oil companies.   Under the new restructuring, or the so-called Plan B, the oil companies - Imperial, Royal Dutch Shell PLC, ConocoPhillips and Exxon Mobil Corp. - would become shippers with long-term commitments. It's unclear whether they would be compensated for the $600-million spent on planning so far.

Calgary-based Trans-Canada has been involved in the Mackenzie pipeline by financing the APG and its involvement would be welcomed by oil companies outside the Imperial partnership that would also like to ship gas on the system. TransCanada's involvement is considered to be improving the pipeline's chances of success because the regulated company has lower profit expectations than oil companies. The restructuring talks have been cloaked in secrecy, partly because of Ottawa's anger about previous leaks that stirred a hornet's nest over the politically sensitive topic of the government aiding a private-sector energy mega project. This restructuring offers the federal government an opportunity to assert Canada's sovereignty in the Arctic.

 

APEX RESOURCES GROUP INC. PROVEN, PROBABLE & POSSIBLE GAS & OIL RESERVES IN THE ITIYOK I-27 SDL #55 IN THE BEAUFORT SEA:

 

The progress of either of the Pipelines being build, adds significant value to the interest that Apex has in the Beaufort Sea Significant Discovery Lease #55. Apex Resources Group Inc. owns 3.745% working interest in the Itiyok I-27 Well (SDL#55) in the Beaufort Sea and is the fourth largest partner in the Itiyok I-27 Well with a 3.745% working interest, with Imperial Oil as the operator and the largest partner with an interest of 58.67312%. At current oil & gas market prices, the Apex 3.745% working interest in the Itiyok I-27 well in the Beaufort Sea is valued at US$1.3 Billion Dollars.

 

 

ITIYOK I-27 WELL SDL#55 PROVEN, PROBABLE, & POSSIBLE GAS & OIL RESERVE VALUES AT CURRENT PRICES:

 

 

 

 

Oil (US$/Barrell)

 

 $                90.0000

 

Gas (US$/ft3)

 

 $                   7.5000

 

Apex Share of Project

3.7450%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1) ITIYOK 640 ACRE PROVEN GAS & OIL RESERVES:

 

 

 

Total Dollars

Apex Dollars

 

Gas (Bscf)

108

 $            810,000,000.00

 $           30,334,500.00

 

Oil (MM STB)

8.976

 $            807,840,000.00

 $           30,253,608.00

 

 

 

 $        1,617,840,000.00

 $           60,588,108.00

 

 

 

 

 

 

 

 

 

 

2) ITIYOK 40KM2 PROBABLE GAS & OIL RESERVES:

 

 

 

Total Dollars

Apex Dollars

 

Gas (TCF)

1.16

 $        8,700,000,000.00

 $         325,815,000.00

 

Oil (MM STB)

160

 $      14,400,000,000.00

 $         539,280,000.00

 

 

 

 $      23,100,000,000.00

 $         865,095,000.00

 

 

 

 

 

 

 

 

 

 

3) ITIYOK 21.54KM2 POSSIBLE GAS & OIL RESERVES:

 

 

 

Total Dollars

Apex Dollars

 

Gas (Bscf)

625

 $        4,687,500,000.00

 $         175,546,875.00

 

Oil (MM STB)

86

 $        7,740,000,000.00

 $         289,863,000.00

 

 

 

 $      12,427,500,000.00

 $         465,409,875.00

 

 

 

 

 

 

 

 

 

 

GRAND TOTAL

 

 

 

 

 

 

Total Dollars

Apex Dollars

 

Gas (Bscf)

 

 $      14,197,500,000.00

 $         531,696,375.00

 

Oil (MM STB)

 

 $      22,947,840,000.00

 $         859,396,608.00

 

 

 

 $      37,145,340,000.00

 $      1,391,092,983.00

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NOTES:

 

 

 

 

Bscf Gas = Billion standard cubic feet of Gas

 

 

TCF Gas = Trillion Cubic Feet of Gas

 

 

MM STB Oil - Million Stock Tank Barrels of Oil

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ITIYOK I-27 WELL (SDL #55) PARTNERS IN ORDER OF HIGHEST %:


IMPERIAL OIL RESOURCES VENTURES                                              58.67312    %

DEVON ARL CORPORATION                                                                  14.72          %

PETRO - CANADA                                                                                      14.20          %

APEX RESOURCES GROUP INC.                                                            3.745        %

CONOCOPHILLIPS CANADA RESOURCES CORP.                   3.003        %

CANALANDS RESOURCES                                                                        2.255734  %

CANADIAN NATURAL RESOURCES LIMITED                                     1.23445    %

CANADIAN FOREST OIL LTD.                                                                  1.084348  %

677862 ALBERTA LTD                                                                                  1.084348  %

 

The Itiyok I-27 Well (SDL#55) was originally drilled in 1983, at a total cost of CAD$85 million. A review of 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, with Apex Resources Group Inc. 3.745 % 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 (Apex 3.745 % working interest net – 34 Bscf and 4.7 MMSTB). The lands in which the Apex Resources Group Inc. owns an interest comprised of 21.54 square KM containing gross potential reserves of 625 Bscf of gas and 86 MMSTB of oil Apex 3.745 % working interest net - 23.4 Bscf of gas and 3.2 MMSTB of oil). Values of proven, probable and possible gas and oil reserves, of Apex 3.745 % working interests, as per Citadel Engineering report, have been published in previous news releases.

 

Our asset has always been significant, but the recent progress on building either or both the Pipelines, will add even more value to the 3.745% working interest in SDL #55. “In my opinion, Apex remains an undervalued oil & gas investment opportunity as a positioning strategy in what will be a major oil & gas play” Stephen Golde, Director of Apex stated.

 

By the Board of Directors,

Apex Resources Group, Inc.

 

Investor Relations: 

Eric David & Sons

Ste # 501- 320

10 Schalks Crossing Road

Plainsboro, NJ 08536

 

Phone: (609) 529-3671

Website: ericdavid.com

Email: steveweiss@ericdavid.com

 

Apex Resources Group, Inc.

www.ApexResourcesGroup.com

Stephen Golde

Director

The foregoing contains forward-looking statements. For this purpose any statements contained in this document that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the foregoing, such words a "may", "will", "believes", "anticipates", "estimates", "continue", or comparable terminology intends to identify forward-looking statements. These statements by their nature involve substantial risks and uncertainties and actual results may differ materially depending upon a variety of factors, including, but not limited to, the successful negotiation and execution of the definitive acquisition agreement and receipt of certain exhibits and schedules requested by Apex Resources Group, Inc.