SOURCE: Arctic Oil & Gas Corporation

August 11, 2008 12:56 ET

California Santa Barbara Channel Lease Applications Over Known Offshore Oil Accumulations

LAS VEGAS, NV--(Marketwire - August 11, 2008) - Arctic Oil & Gas Corp. (PINKSHEETS: AOAG), a petroleum exploration company, is pleased to announce that The Company is a co-applicant for a group of offshore OCS and State leases in the Santa Barbara Channel covering known oil-gas deposits estimated to contain between 250 million to 500 million barrels of oil and gas equivalent. These resources have minimal geological risks being identified plays in known petroleum fields.

Eventually securing the leases will be subject to the State and Federal governments releasing the areas from the drilling moratoriums now still in force and accepting the applicant's proposed royalty and operations plans. This might take some time.

Newer technology floating production and storage and offloading (FPSO) vessels can be placed far away from beach-adjacent subsea wellheads to ensure shore views are undisturbed. This will protect the local tourist industry and the quality of life of local residents will be enhanced by the reduction in air and sea pollution currently caused by natural oil-gas seeps, which will be substantially reduced by the Applicant's production strategies.


This project could generate significant oil revenues and provide $2.50 gasoline to Santa Barbara residents.

It's critical to reduce the U.S. dependence on foreign oil. 10 billion barrels of untapped easily accessible oil lies offshore from California, according to the EIA.

Oil production in these areas for domestic energy would help to reduce natural oil-seeps pollution and reduce reliance on foreign oil and help stop America hemorrhaging $600 billion a year overseas.

The Company has also proposed landing natural gas from its 30% owned Bering Sea Gas project into the California gas pipeline grid via Santa Barbara County, paying significant County-State royalties and clean-fuel environmental benefits.

This Gas could supply fuel for cleaner, Compressed Natural Gas vehicles.

About Arctic Oil & Gas

The Company has 30% interests in three other speculative properties with substantial energy resources potential:

A)   Arctic Commons Hydrocarbons Claim.
B)   North and South Carolinas. Blake Ridge Natural Gas Project.
C)   Bering Sea Abyssal Commons Natural Gas Project.

Arctic Oil Rush

A recently released U.S. Geological Survey report indicates the Arctic region houses the equivalent of 412 billion barrels of oil, mostly natural gas, making it the largest source of untapped hydrocarbons on earth. Much of it lies beyond the existing 200-nautical-mile economic zones and thus is located within AOAG's 30% owned Arctic Claim.


AOAG HAS ARCTIC HYDROCARBONS CLAIM: AOAG Management is reminding the five arctic countries' governments that the Company and its partners have a strong prior Claim to the Arctic Abyssal Commons hydrocarbons resources.

The new USGS estimate of the Arctic's natural oil and gas wealth should make U.S. Senators think twice before signing on to the Law of the Sea and effectively gifting perhaps $50 trillion worth of energy to a hostile UN bureaucracy.

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This announcement contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. Actual results may differ from management's expectations. These forward-looking statements involve risks and uncertainties that include, among others, risks associated with oil & gas exploration risks related to competition, management of growth, new products, services and technologies, potential fluctuations in operating results, international expansion, commercial agreements, acquisitions and strategic transactions, government regulation and taxation. More information about factors that potentially could affect AOAG's financial results is included in its filings with the Securities and Exchange Commission.

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