Hawker Energy Completes Acquisition of TEG Oil & Gas U.S.A., Inc.

TEG holds four oil leases covering 280 acres within the Tapia Canyon Oil Field.  Based on information provided by the seller, proved net recoverable reserves are estimated by Hawker to be 3.5 million barrels of oil.  

After completion of well repairs currently underway and funded by Hawker through its loan to TEG, 18 active wells are expected to produce between 80 and 120 barrels per day of oil.  Hawker plans to conduct a phased exploitation development program, including the implementation of a steam flood at an estimated cost of $10 million, which is expected to increase production from current levels to over 500 barrels per day.

Eureka Oil Field 

The Eureka Oil Field covers an area of approximately 1,600 acres located about 25 miles west of the Tapia Canyon Oil Field in Ventura County, California.  Eureka Oil Field production is very small currently but the property has exploration potential.

Additional Information Concerning The Acquisition And Related Matters 

TEG's senior lender, Bank of the West ("BOTW"), consented to Hawker's acquisition of TEG and agreed to extend its senior loan until December 31, 2015, provided that several conditions be met including (i) Hawker lend TEG not less than $350,000 within the first quarter of 2015, and (ii) interest on TEG's obligations to BOTW be increased to 9%, with a monthly pay rate of 5% and the remaining 4% deferred. The current balance owing on TEG's BOTW loan is $4.0 million.  All advances made and to be made by Hawker and its subsidiary to TEG are subordinated in all respects to amounts owing by TEG to BOTW.

Additional important information concerning the acquisition, amendments to the secured subordinated note receivable and a related intercreditor agreement, the BOTW consent and extension, and a proposed amendment to a secured convertible note payable can be found in the Hawker Quarterly Report on Form 10-Q for the three months ended November 30, 2014 filed with the SEC on January 20, 2015.

All acreage and production estimates shown above are gross figures before reduction for royalty interests.  TEG owns a 100% working interest in both fields.

About Hawker Energy 

Hawker Energy, Inc. (OTCQB:HWKR) is focused on the acquisition and exploitation of oil properties through redevelopment in Southern California.  Its goal is to deliver long-term value to its shareholders through financial discipline, opportunistic acquisition and efficient operation.  

Hawker owns the 40 acre DEEP Lease in the Midway Sunset field in California, and claims developmental rights of certain mineral rights of coastal lease PRC 145.1 just offshore from Ventura County, CA in the Rincon Field, and ownership rights to an associated on-shore drilling and production site.  These rights are being contested in court.  Hawker Energy's headquarters are located in Redondo Beach, California.

Stock Exchange Information 

OTCQB: HWKR

CUSIP:  42012W107

Safe Harbor Statement 

Statements herein concerning the Company's plans, litigation, reserves, resources, growth, acquisition plans, anticipated production increases, financings and strategies may include "forward-looking statements" within the context of the federal securities laws. Statements regarding the Company's future events, developments, future performance, litigation, reserves, resources, acquisitions, production levels, production increases and financings as well as management's expectations, beliefs, plans, estimates or projections relating to the future, are forward-looking statements within the meaning of these laws. The Company's actual results may differ materially from those suggested as a result of various factors beyond the Company's control.  Oil and gas acquisition, exploration and development is a capital intensive business, and the Company will require significant amounts of additional capital for steamflood implementation, well work-overs, field maintenance and other operational matters, as well as to consummate future acquisitions. The Company's ability to obtain additional financing is not certain, particularly in this time of extreme price volatility in the oil industry. The Company will also need to refinance TEG's BOTW loan during 2015, and the availability of debt or equity financing to accomplish this goal is likewise uncertain, and for similar reasons. Interested parties should refer to the disclosure concerning the operational and business concerns of the Company set forth in the Company's filings with the Securities and Exchange Commission.

Contact: Investor Relations and Media
Darren Katic - Chairman and CEO
Phone: +1-310-438-7997