SOURCE: Victory Energy

February 20, 2007 09:00 ET

Victory Energy Corporation Signs Letter of Intent to Drill Palo Duro Basin

LOS ANGELES, CA -- (MARKET WIRE) -- February 20, 2007 --Victory Energy Corporation (OTCBB: VYEY) today announced it has entered into a letter of intent dated February 19, 2007.

Mr. Jon Fullenkamp, President and Chief Executive Officer of Victory Energy Corporation, the ("Company"), announced today that the company has entered into a Letter of Intent with Eldorado Exploration to conduct a drilling program on Eldorado's Palo Duro Basin Texas leases.

The letter of intent sets out the substantive terms of a Formal Agreement ("Agreement") that Eldorado and Victory will complete and execute within 60 days. Under the Agreement, Victory will be required to conduct up to one hundred thousand dollars ($100,000.00) for seismic evaluation to determine the first three drilling targets. In exchange, Victory will receive 50% of the mineral rights of all hydrocarbon deposits on the first 8 sections, approximately 5,000 acres of land. During the evaluation of the drilling targets, and including the time to drill the first 3 wells, Victory Energy Corporation will have the ability to exercise its irrevocable option to lease up to a total of 100,000 acres of mineral rights within the Palo Duro Basin from Eldorado and its partners.

"With the ability to lease up to 100,000 acres in Texas, coupled with the 138,000 acres Victory has in Montana, the Company is in an extremely attractive position within the petroleum industry for growth and providing enhanced shareholder value through future asset development," stated Jon Fullenkamp, President of Victory Energy Corporation.

About Victory Energy Corporation: Victory Energy Corporation (http://www.victoryenergyoilandgas.com) is a publicly traded, developmental stage petroleum company primarily dedicated to energy-related opportunities. The Company goal is to evaluate profitable options, develop a solid foundation through leadership and sound business acumen, and acquire producing wells as well as other potentially profitable prospects within the Oil & Gas Industry.

Certain statements contained herein are "forward-looking" statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). Because such statements include risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements include, but are not limited to, those discussed in filings made by the Company with the Securities and Exchange Commission. The Company's filings may be accessed at the SEC's EDGAR system at www.sec.gov. Statements made herein are as of the date of this press release and should not be relied upon as of any subsequent date. The Company cautions readers not to place reliance on such statements.

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