SOURCE: Victory Energy

Victory Energy

May 24, 2011 12:33 ET

Victory Energy Provides Market Update for Tunis Creek Prospect

Additional Ellenberger Oil and Gas Shows Discovered --Well in Completion Stage

NEWPORT BEACH, CA--(Marketwire - May 24, 2011) - Victory Energy Corporation (PINKSHEETS: VYEY), through its partnership with Aurora Energy Partners, today announced that formation testing has been completed at its recently acquired Tunis Creek oil and gas prospect and that the well is now entering the completion stage of the drilling schedule. The well was spud on April 22, 2011.

The primary target Ellenberger formation was drill stem tested (DST) over the weekend and encountered an additional 45 feet of possible oil and gas pay. During this testing procedure 2,813 feet of gas cut oil with no water was recovered. The Wichita Albany formation showed approximately 18 feet of possible pay on the mud log. The Wolfcamp formation was drill stem tested (DST) and showed 28 feet of possible pay.

The prospect is up dip of a well that produced over 20 thousand barrels of oil from the Ellenberger formation.

Robert Miranda, Victory Energy's chairman and CEO, stated, "We are pleased to have encountered three possible oil and gas pay zones at Tunis and we are thrilled that our primary Ellenberger target performed so well. The 45 foot Ellenberger section is exciting because of its combined oil and gas production possibilities along with other characteristics that tend to indicate the presence of a sizable reservoir. We look forward to seeing the Tunis well completed and going to production. This well represents another significant step in the building of a very robust oil and gas portfolio for our company."

Victory holds a 5 percent working interest and a 3.75 percent net revenue interest in this oil focused prospect.

About the Tunis Creek Prospect
The company acquired its interest in the prospect from well-known Midland, Texas based V-F Petroleum Inc., who is also the operator of the well. The Tunis Creek prospect is located twenty-five miles due east of Fort Stockton, Texas, in eastern Pecos County, and is surrounded by significant hydrocarbon shows in all targeted horizons.

The prospect is within the Central Basin Platform of the prolific Permian Basin and is located up dip of a previously producing oil and gas well. Hydrocarbon delivery infrastructure is nearby. The operator plans to drill the Tunis Creek prospect to a total depth of 7,500 feet. The 1,600 acre lease comprises two sections of block 20, University Lands survey.

Just over two thirds of a mile to the east-northeast in the same section, Midwest Oil opened the one-well Renaud & Tunstill field. That Midwest Oil well (1 University) is down dip of the Tunis Creek prospect and was completed in 1960. The 1 University well pumped 248 barrels of 43-degree oil per day from the Ellenburger formation at 6,810-95 feet. Production for the 1 University well through 1965 totaled over 20 thousand barrels of oil and 1.65 million cubic feet of casinghead gas.

About Victory Energy Corporation
Victory Energy Corporation is engaged in the exploration, acquisition, development, and exploitation of oil and gas properties. The company endeavors to utilize its broad range of oil and gas industry relationships to acquire small interests in a large volume of low- to moderate-risk oil and gas prospects. A cornerstone of this strategy is an emphasis on developing and maintaining relationships with proven, well established oil and gas exploration and development companies.

Prospect acquisitions are ideally weighted toward oil, although natural gas projects with high btu content, favorable above-market pricing and modest decline rates will also be targeted. Targeted prospects generally provide the company with a rapid return of capital while offering multiple well locations for additional drilling on an established trend. The model asset portfolio is geologically and geographically diversified. The company's current producing oil and gas assets are located in the United States.

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Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
There are forward-looking statements contained in this news release. They use such words as "intend," "will," "may," "expect," "believe," "plan," or other similar terminology. These statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results to be materially different than those expressed or implied in such statements. These factors include, but are not limited to: risks associated with the implementation of the Company's strategic growth plan; legislation and government regulation including the ability to obtain satisfactory regulatory approvals; conditions beyond the Company's control such as weather, natural disasters, disease outbreaks, epidemics or pandemics impacting the Company's customer base or acts of war or terrorism; availability and cost of materials and labor; demand for natural gas; cost and availability of capital; competition; the Company's overall marketing, operational and financial performance; economic and political conditions; the continued service of the Company's executive officer; adverse developments in and increased or unforeseen legal costs related to the Company's litigation; the success of the Company's strategic partnerships and joint venture relationships; the Company's ability to pay certain debts; adoption of new, or changes in, accounting policies and practices; adverse court rulings; results of other litigation in which the company is involved; and other factors discussed from time to time in the Company's news releases, public statements and/or filings with the Securities and Exchange Commission. Forward-looking information is provided by Victory Energy Corporation pursuant to the safe harbor established under the Private Securities Litigation Reform Act of 1995 and should be evaluated in the context of these factors. In addition, the Company disclaims any intent or obligation to update these forward-looking statements.

Contact Information

    Robert J. Miranda
    Chairman and Chief Executive Officer

    Investor Relations