1. Underground Energy Corp.
Unlocking Shale Oil Opportunities in California & Nevada
TSX-V:UGE
Corporate Presentation
March 2012

2. California Focused with Nevada Upside
 Currently 71,015 net acres under lease in
California and Nevada
 31,884 net acres prospective for oil primarily
CALIFORNIA from prolific Monterey shales in Santa Maria
and San Joaquin Basins
• Initial focus is conventional oil recovery from
NEVADA naturally fractured Monterey targets
San Francisco • 2 producing wells (80 bopd), multiple drill
ready sites and exploration prospects
• Management’s initial estimates of 6 MMbbls
2P reserves / 20.8 MMbbls prospective
Asphaltea Las Vegas resources at Zaca1
• GLJ assigned 2 billion bbls OOIP and 109
MMbbls of prospective recoverable resources
Los Angeles at Asphaltea2
Zaca
• Initial 5-10 well drilling program underway
 7,887 net acres of non shale prospects in the
San Joaquin Basin
Underground leases
 31,286 net acres in 6 prospects in Nevada
1. Management estimates which also include a review by an internal qualified reservoir engineer
2
2. Source: GLJ Petroleum Consultants, effective date June 1, 2011

3. A Team Built for California Oil
Management Independent Board Members
Michael Kobler – Founder, Chairman, Bruce Berwager – Chief Operating Officer Randy Aldridge - Director
President & CEO 32 years international oil & gas experience; 35 years international oil experience;
35 years oil & large infrastructure projects Chevron, Unocal, Conoco, Warren President of Koch Pipelines & Koch
globally and in California; former COO and Director of Venoco; Petroleum Canada; Koch Oil Co., True Energy
Founder and former CEO 20+ years shale experience
of OSUM Oil Sands in CA, TX, PA
Peter Ballachey – Founder, CFO & Corporate Simon Clarke – VP Corporate Development Harland Johnson - Director
Secretary 20+ years capital markets experience; 45 years technical and management
35 years international financial experience; RailPower, Director of Invico Energy and upstream experience in Trinidad & Brazil:
Canadian Pacific, RailPower, BC Rail Argus Metals, ExxonMobil and affiliates
and CFO at OSUM Oil Sands Founder of OSUM Oil Sands
Dana Brock – VP Engineering David Hoyt – VP Exploration & Development Andrew Squires - Director
33 years California energy and infrastructure 40+ years in exploration and development 23 years heavy oil experience;
experience; ARCO, Unocal, Radian and geology and geophysics; 25 years in California Petro-Canada, Dome, Amoco, Paramount;
OSUM Oil Sands with ARCO, TXO, Warren, Foothill current Senior VP OSUM Oil Sands
Randy Ray – Chief Geophysicist Kim Wolfe – Regulatory Mgr. & Compliance Douglas Urch - Director
36 years in western US; expert in integrated 13 years oil & gas experience in CA and Santa 30+ years international experience;
seismic and geological interpretation ; Barbara permitting and regulatory; CFO Bankers Petroleum and previously CFO
BreitBurn, Encana, PanCanadian Venoco, Greka, SCS of Rally Energy
 California-based team with proven track record of creating significant shareholder value
• Founders of OSUM Oil Sands Corp. ($2.0 billion private oil sands company based in Calgary, AB)
California-based
• Operations team with proven track record of finding and growing reserves & production in California
Note: Refer to the Appendix for detailed description of the Company's management team and board of directors 3

4. Capital Structure Snapshot
UGE $0.25
Listed on the TSX Venture Exchange February 23, 2012 Closing Share Price
204.2 million $51.1 million
Basic Shares Issued and Outstanding Market Capitalization (on Basic Shares)
337.9 million $16.0 million
Fully Diluted Shares Outstanding Cash Balance at December 31, 2011
16.5% $31.0 million
Insider Ownership Working Capital at December 31, 2011
25.9% $35.1 million
Institutional Ownership Enterprise Value (on Basic Shares)
57.6% $37.0 million
Retail Ownership Potential Proceeds from Dilutive Securities
4

5. Recent Achievements
 Assembled a quality asset base with multiple prospects:
39,729 net acres in California and 31,286 net acres in
Nevada to-date
 Closed $25.5 million brokered private placement,
completed RTO & commenced trading on the TSX-V
 Acquired & processed approx. $3 million in seismic over
the past 9 months
 Completed transition to a production-ready company
 Initial production of 80 bopd
 Secured 5-10 well initial drilling contract
 Drilling commenced at Zaca late-February 2012
5

6. Growth Strategy
 Grow primarily through the drill bit
 Aggressively drill prospects to ramp-up production
Enhance  Apply advanced drilling, completion and
recovery technologies to maximize recovery
Shareholder Value
 Convert prospects to drill-ready projects
 De-risk portfolio through:
• G&G technical assessments
Build • Advanced 2D/3D seismic techniques
• Appraisal drilling and formation evaluation
 Aggregate additional quality prospective acreage
UGE Today
 Proven management team
 Strong, committed investor base
Platform  Quality asset portfolio under lease with a mix of lower risk assets
and high impact resource opportunities
Time
6

7. Monterey Shale Formation
Significant Monterey Shale Basins
World Class Source Rock
 Over 290 billion barrels of oil generated1
World Class Reservoir Rock
San Joaquin Basin
 Has produced over 2.5 billion barrels1
 High organic content of 4-5%
 Extremely thick shale packages of 500-3,500 ft
 Compared to other US shale plays:
 Bakken: 20-150 ft
Santa Maria Basin  Eagle Ford: 75-300 ft
 Niobrara: >150 ft
Monterey is the source and
reservoir rock for most of the
Ventura & Santa Barbara Channel Los Angeles
major oil fields discovered in
Underground Monterey prospects
California
Los Angeles Basin
1. Source: California DOGGR and USGS 7

8. Key Monterey Players
 Largest Monterey land holder in State (LA,  Actively drilling in San Joaquin, Santa Maria and
Ventura and San Joaquin basins) Salinas basins – 214,000 net acres
 10-15 exploratory wells per year planned  Joint 500 mile seismic shoot in San Joaquin with
through 2015 to test shale prospects Oxy – first half complete
 Announced two 2011 Monterey discoveries
 200,000 acres and 520 drilling targets
de-risked for oil-prone shale development • Sevier (90 MMboe)
• Salinas Valley (44 MMboe)
 $1.5 billion capex budget for California
(195 shale wells in 2011 – IPs of 300+)  2012 plan 50-75, largely vertical, Monterey wells
 Now Producing approx. 50,000 bopd from  Recent take private offer at $12.50 per share
Monterey and equivalent shales ($1.4 billion enterprise value)
Other players
8

9. Monterey Shale Type Curves
BOPD
1000
Oxy Monterey Type Curve (100+ wells)
Horizontal Wells EUR = 645 Mbbls
100
Zaca Field Vertical Well Normalized Monterey Type Curve (61 wells)
10 Vertical Wells EUR = 540 Mbbls
1
0 12 24 36 48 60 72 84 96 108 120 132 144 156 168 180 192 204 216 228 240 252
Months
1. Source: Occidental Petroleum Corporation, Minerals Management Service, DOGGR 9

10. Oil Pricing Comparison
California (CA) MWSS begins
$120.00 trading at a $120.00
 CA imports 62% of crude oil (~ 1 MM bopd) by sea premium to WTI
(Alaskan North Slope, Latin America, Asia, Middle East)
$110.00 $110.00
 CA is not connected to other US oil supply or markets
$100.00  CA oil prices currently more reflective of world prices $100.00
(e.g. Brent) than WTI
$90.00  Significant rig availability with low servicing costs and year– $90.00
round access to CA projects
$80.00 $80.00
$70.00 $70.00
$60.00 $60.00
$50.00 $50.00
$40.00 Western Canada Select- 20.6 API $40.00
WCS
MWSS Midway Sunset- 13.0 API
$30.00 WTI West Texas Intermediate- 39.6 API $30.00
$20.00 $20.00
Jan-09 Jan-10 Jan-11 Jan-12

11. Santa Barbara County & Santa Maria Basin
Foxen Canyon Trend
Santa Maria
207
Santa Barbara County
All American Pipeline
Cat
Canyon Asphaltea
Prospects
251
Orcutt North
209 28
73
Gato Ridge
South
54
Barham Zaca
Los Alamos
Monterey Fields Ranch
Refinery
35
Lompoc 52
Underground leases
3 miles
Estimated Ultimate Oil Recoveries (MMBO)
11

12. Zaca Extension Project
 Santa Barbara County, California
10 0 10 20 30 40 50 miles
San Francisco
Modesto
 80% WI (Operator)
Merced
County  7,750 gross acres (6,200 net acres)
Stanislaus
County San Joaquin Basin  Monterey targets (analog to Asphaltea)
Madera
County
 Zaca field (32 MMbbls recovered to date)
Challenger
Fresno  Average vertical well IP’s 205 BOPD and
County
EUR of 540 Mbbls oil
San Benito Fresno
County  6 MMbbls 2P Reserves1
Burrel  20.8 MMbbls Prospective Resources1,
Tulare
 Includes:
Kings
County
County
• 1 producing test well (15-20 bopd)
• Existing 2D seismic coverage re-
Petroleum Basin
processed and new seismic swath
Producing Oil Field Devil’s Den Buttonwillow acquired December 2011
Producing Gas Field • 20-30 initial drilling locations

Underground Property San Luis Obispo
County Bakersfield Additional structures identified by seismic
Highlighted Property
 Permitted pad locations chosen
Santa Maria Basin
Kern
County  Drilling of step out extension wells to
Asphaltea commence late February 2012
Santa Rita
Zaca Santa Barbara
County
Santa Barbara
1. Management estimates which also include review by an internal qualified reservoir engineer 12

13. Underground’s
Zaca
Assets
• Historic recovery rates
6.8%
• Primary recovery
techniques only
• Potential to increase
recovery rates further Permitted Site B Permitted Site D
• Latest seismic
techniques
• Deviated /
horizontal drilling
• Possible EOR
• Thermal testing
1964-1967
• Waterflooding
1953-1954
Existing Oil Well
Underground Energy Lease Boundary
Zaca Oil Field Recognized Boundary
Existing Zaca Field
Probable Geologic Structure Identified by Seismic
Possible Geologic Structure Identified by Seismic
Existing Seismic Line circa 1986
New Seismic Line circa 2011
Permitted Pad Locations
Initial Well Locations 13

14. Zaca Well Economics
Zaca Field – All Historic Wells
Typical Well All Wells Infill Wells Normalized Type Curve (61 wells)
250
Type Curve Type Curve
Well Depth (MD feet) 4,500-6,500 4,500-6,500 200
Dry Hole Well Costs ($M) $800-$1,300 $800-$1,300 150
Completion Cost ($M) $200-$400 $200-$400 100
Total Well Cost ($M) $1,000-$1,700 $1,000-$1,700 50
UGE Interest (WI / NRI) 80% / 62.6% 80% / 62.6%
0
0 60 120 180 240 300 360
Initial Prod Rate (BOPD) 205 70
Zaca Field – Infill Wells Drilled 1971 to Present
Cum. Production (MBO) 535 375 Normalized Type Curve (18 wells)
250
NPV @10% BT ($M)1 $ 12,025 $ 8,163
200
IRR (%) 231% 90%
150
Payback (years) 0.42 1.13 100
50
0
0 60 120 180 240 300 360
1. Economics are internal estimates using NYMEX Futures Strip Prices as of Jan.30, 2012 with $14.74 deduction for diluent, gravity, location
14

15. Asphaltea Project
 Santa Barbara County, California
10 0 10 20 30 40 50 miles
San Francisco
Modesto
 100% WI (Operator)
Merced
County  5,850 acres
Stanislaus
County San Joaquin Basin  2 billion bbls OOIP / 109 MMbbls
Madera
County
Prospective Resources1
Challenger
Fresno • Assumes 4.8% recovery rate – analog
County
fields 10-15%
San Benito Fresno
County  Monterey shale oil targets
Burrel • Highly fractured, conventional structures
Tulare
• Close to infrastructure and existing
Kings
County
County
Monterey production
 Analog fields: Zaca (32 MMboe), Cat Canyon
Petroleum Basin
(251 Mmboe), Orcutt (209 Mmboe)
Producing Oil Field Devil’s Den Buttonwillow  Includes:
Producing Gas Field • 30+ miles of seismic acquired in Q2 and
Underground Property San Luis Obispo
County Bakersfield Q4 2011 being processed
Highlighted Property
• 26 permitted wells
Santa Maria Basin
Kern
County  Near term plan:
• Process and interpret seismic
Asphaltea
Santa Rita Zaca Santa Barbara
County
• First well targeted mid 2012
Santa Barbara
1. Source: GLJ Petroleum Consultants, effective date June 1, 2011 15

16. Asphaltea Well Economics
350
Parameter Typical Well OXY Shale Oil Well Type Curve
300 (Modeled UGE Curve)
Well Depth (MD feet) 7,000-9,000 250
Dry Hole Cost ($M) $1,900-$2,300 200
BOPD
Completion Cost ($M) $900-$1,200 150
Total Well Cost ($M) $2,800-$3,500 100
50
UGE Interest (WI / NRI) 100% / 81.25%
0
Initial Prod Rate (BOPD) 250-300 0 60 120 180 240 300 360
Cum. Production (MBOE) 648 Months
$20 140%
NPV @ 10% BT ($M)1 $19,044 $18
Asphaltea Individual Well Economics
NPV @ 10% ($MM)
Oil Price Sensitivity 120%
IRR (%) 1 164% $16
$14 100%
NPV10
IRR (%)
Payback (years) 1 0.8
$12 80%
$10 IRR
60%
Sensitivity at 25% Higher Capex and $80/bbl $8
$6 40%
NPV @ 10% BT ($M) $15,554 $4
20%
$2
IRR (%) 107%
$0 0%
Payback (years) 0.9 $10 $20 $30 $40 $50 $60 $70 $80
1. Economics are internal estimates based on Jan. 30, 2012 NYMEX Futures strip prices (see deck in the Appendix)
16

17. Asphaltea Development Profile1,2
 Unrisked peak production of 22,300 boepd in 2020 with attractive well economics and conservative
horizontal/deviated development well type curves
 Overall unrisked project before tax NPV 10% of $2.2 billion
Asphaltea Prospect Unrisked Development Profile to 2025
22,500 $4,000
South Prospect
South Prospect
20,000 North Prospect
North Prospect $3,500
Cumulative Free Cash Flow
Cumulative Free Cash Flow
17,500 $3,000
Daily Gross Production (boepd) - 91% Oil
Cumulative Free Cash Flow ($USMM)
15,000 $2,500
12,500 $2,000
10,000 $1,500
7,500 $1,000
5,000 $500
2,500 $0
0 ($500)
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Calendar Year
1. Recoverable resource volumes are from GLJ Petroleum Consultants, effective date June 1, 2011
17
2. Economics are internal estimates based on Oct. 21, 2011 NYMEX Futures strip prices

18. Other California Assets
Devil’s Den
San Francisco 10 0 10 20 30 40 50 miles  Kern County, California
Modesto
Merced
 65% WI (Operator), 6,795 gross acres (4,417 net acres)
County  Shallow Monterey (Diatomite) and Tumey shale oil targets
Stanislaus
County San Joaquin Basin  Analog fields: McKittrick (350 MMboe), Cymric (543 MMboe)
Madera
Challenger
County  Madera and Merced Counties, California
Challenger Fresno  70.49% WI (Operator),11,219 gross acres (7,887 net acres)
County
 Zilch, Blewett, Vaqueros/Temblor sands; and Kreyenhagen
San Benito Fresno
County & Moreno shale gas targets
Burrel
Burrel
 Fresno County, California
Kings
Tulare  80% WI, 10,656 gross acres (8,525 net acres)
County
County
 Zilch & Vaqueros sand, Monterey & Kreyenhagen oil targets
 1 producing well (65 bopd)
 Analog fields: Helm (46 MMboe), Raisin City (47 Mmboe)
Petroleum Basin Buttonwillow
Producing Oil Field Devil’s Den Buttonwillow  Kern County, California
Producing Gas Field  80% WI (Operator), 1,445 gross acres (1,156 net acres)
Underground Property San Luis Obispo
Bakersfield  Monterey/McClure shale, 44X and Randolph sand oil
County
Highlighted Property targets
 Analog fields: North Shafter (10 MMboe), Rose (4.8 MMboe)
Kern
County Santa Rita
Santa Maria Basin
 Santa Barbara County, California
Asphaltea
 80% WI (Operator), 1,217 gross acres (974 net acres)
Santa Rita Zaca Santa Barbara
County  Monterey shale & Point Sal sand oil targets
Santa Barbara  On trend with Lompoc Field (52 MMbbls)
18

19. Nevada Assets
 “Early mover” advantage by building a strong
Bull Run
land position ahead of the curve
Deadman
Winnemucca Elko Creek  Complex geology, but existing discoveries have
had very high production rates
 Emerging shale oil potential (Bakken-like)
Blackburn
 Key competitors will help prove up plays -
West
Cabot (COG), EOG (EOG), SM Energy (SM),
Reno Callon (CPE), PetroHunt
RAILROAD VALLEY
46.2MMBO
Trap  Deadman Creek– 2D and 3D seismic
Springs Flat Top
Coaldale purchased, interpretation begun
 Blackburn – 2D and 3D seismic purchased,
interpretation begun
 Coaldale – Offset exploratory well drilling
Las
Vegas  Bull Run – Surface geological mapping
underway
Underground leases
19

20. Initial Exploration and Development Plan
Activity 1Q12 2Q12 3Q12 4Q12 Net Cost ($MM)
Acquire & Process Seismic $1.3
(30 mi 2D)
Zaca
Drilling 4 Monterey Shale Wells XX $5.4
Design & Build Facilities $1.8
Process Seismic $0.1
(50 mi 2D)
Asphaltea
Drill & Test 1 Monterey Shale $3.2
Well
Acquire & Process Seismic $0.5
(50 mi 2D)
Devil’s Den
Drill and Test 2 Tumey Shale $2.4
Wells
Acquire & Reprocess Seismic $0.5
Buttonwillow/ (16 sqmi 3D, 30 mi 2D)
Burrel/MVA Continue Leasing at MVA $0.5
$15.7
Seismic Drilling Other
1. Management estimates which also include review by an internal qualified reservoir engineer 20

21. Initial Development Profile
$6,000,000 600
 Dec 2012 exit WI production: 510 bopd
528 bopd
 Dec 2012 exit annualized operating cash flow: $9.1 M
Cumulative Operating Cash Flow
$5,000,000 500
WI Production bopd
$4,000,000 400
$3,000,000 300
$2,000,000 200
$1,000,000 100
$- 0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
1. Economics are based on management estimates of production pre-royalty and based on Jan. 30, 2012 NYMEX Futures strip prices 21

22. Company Timeline
2010 2011 2012
$6MM pre-IPO
equity financing
Farm-in on EQ Energy
28,984 acres, Nevada
Santa Barbara County
permitting expertise added
Entered into San Joaquin /
Santa Maria AMIs
Development agreement
California/Monterey operational with Titan on Mustang Flats
expertise added
Closed RTO and started
trading on TSX-V Secure drilling rig for
Land-use permit granted for initial 2012 program
Closed Panther
initial 26 Asphaltea wells Acquisition of 2,390 acres acquisition
in Nevada, second lease
Commence step out drilling at Zaca
at Asphaltea (3,400 acres)
Monterey/Nevada geological GLJ Reserve Report due
expertise added
Initial
seismic
shoot at
Asphaltea
GLJ report – Seismic
2.3billion bbls oil shot at Zaca /
initially in place Asphaltea
Closed $25.5 million Commence drilling at
financing Asphaltea / Devil’s Den
Complete interpretation of Asphaltea seismic
2D / 3D seismic and geological
analysis of San Joaquin assets
22

23. Contact Information
Underground Energy Corp. President & CEO – Mike Kobler
3rd Floor mike.kobler@ugenergy.com
7 W. Figueroa Street Phone: (805) 845-4700, x18
Santa Barbara, CA,
93101-5109 CFO – Peter Ballachey
peter.ballachey@ugenergy.com
Tel: 805.845.4700
Phone: (805) 845-4700, x17
Fax: 805.845.1177
www.ugenergy.com COO – Bruce Berwager
bberwager@ugenergy.com
Phone: (805) 845-4700, x11
VP Corp Development – Simon Clarke
simon.clarke@ugenergy.com
Phone: (604) 551-9665
23

24. Cautionary and Forward Looking Statements Advisory
Underground Energy Corp. (Underground Energy) is a British Virgin Island holding company that owns Underground Energy, Inc., a Delaware corporation which is
an exploration and production company focused on unlocking oil from shale plays, principally in the Western US. Underground Energy is traded on the TSX
Venture Exchange under the trading symbol "UGE.“
Statements in this presentation contain forward-looking information and forward-looking statements within the meaning of applicable securities laws (collectively,
"forward-looking information"). Forward-looking information is frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate",
"estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur. In particular, forward-looking information in this
presentation includes, without limitation, statements with respect to: (i) the closing and closing date of the Company's proposed acquisition of oil and gas leases in
California; (ii) the Company's planned seismic operations to be conducted on such oil and gas leases; and (iii) the prospectivity of such oil and gas leases for oil
and gas and the anticipated drilling, completion and production results therefrom. Readers are cautioned that assumptions used in the preparation of forward-
looking information may prove to be incorrect.
Although we believe that the expectations and assumptions reflected in the forward-looking information are reasonable, there can be no assurance that such
expectations or assumptions will prove to be correct. In particular, assumptions have been made that: (i) Underground will be able to obtain equipment and
regulatory approvals in a timely manner to carry out exploration and development activities; (ii) Underground will have sufficient financial resources with which to
conduct its planned capital expenditures; and (iii) the current tax and regulatory regime will remain substantially unchanged. Certain or all of the forgoing
assumptions may prove to be untrue.
Forward-looking information is based on the opinions and estimates of management at the date the statements are made, and is subject to a variety of risks and
uncertainties and other factors (many of which are beyond the control of Underground) that could cause actual events or results to differ materially from those
anticipated in the forward-looking information. Some of the risks and other factors could cause results to differ materially from those expressed in the forward-
looking information include, but are not limited to: operational risks in exploration, development and production; delays or changes in plans; competition for and/or
inability to retain drilling rigs and other services; competition for, among other things, capital, acquisitions of reserves, undeveloped lands, skilled personnel and
supplies; risks associated to the uncertainty of reserve and resource estimates; governmental regulation of the oil and gas industry, including environmental
regulation; geological, technical, drilling and processing problems and other difficulties in producing reserves; the uncertainty of estimates and projections of
production, costs and expenses; unanticipated operating events or performance which can reduce production or cause production to be shut in or delayed;
incorrect assessments of the value of acquisitions; the need to obtain required approvals from regulatory authorities; stock market volatility; volatility in market
prices for oil and natural gas; liabilities inherent in oil and natural gas operations; access to capital; and other factors. Readers are cautioned that this list of risk
factors should not be construed as exhaustive.
The forward-looking information contained in this presentation is expressly qualified by this cautionary statement. Underground does not undertake any obligation
to update or revise any forward-looking statements to conform such information to actual results or to changes in our expectations except as otherwise required by
applicable securities legislation. Readers are cautioned not to place undue reliance on forward-looking information.
BOEs may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 Mcf: 1 bbl has been used and is based on an energy equivalency conversion
method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.
24

25. Notes to Disclosure
1. Prospective resources are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from
undiscovered accumulations by application of future development projects. Prospective resources have both an associated
chance of discovery and a chance of development. There is no certainty that any portion of the prospective resources will be
discovered and, if discovered, there is no certainty that it will be commercially viable to produce any portion of those
resources. Prospective resources are undiscovered resources that indicate exploration opportunities and development
potential in the event a commercial discovery is made and should not be construed as reserves or contingent (discovered)
resources. Prospective resources in this presentation are reported on an unrisked, company interest basis.
2. The reserve and resource estimates in respect of the prospective resources for the Zaca Field for Underground were
prepared on October 27, 2011 with an effective date of November 1, 2011 and prepared in accordance with COGE
Handbook and National Instrument 51-101 – Standards of Disclosure for Oil and Gas Activities ("NI 51-101") by a member of
management of Underground who is a "qualified reserves evaluator" as defined under NI 51-101.
3. The "best estimate" is considered to be the best estimate of the quantity that will actually be recovered. In terms of
prospective resources, it is equally likely that the actual quantities recovered will be greater or less than the best estimate. In
terms of discovered reserves, the “best estimate” is the combination of the proved plus probable reserves. If probabilistic
methods are used, there should be at least a 50 percent probability that the quantity actually recovered will equal or exceed
the best estimate.
4. The significant positive factors that are relevant to the management's estimate of the reserves and prospective resources
include production in close proximity to the assets and oil and gas shows in wells drilled in close proximity to the assets. A
significant negative factor that is relevant to management's estimate of prospective resources is that seismic attribute
mapping in the areas can be indicative but not certain in identifying resources.
5. Possible reserves are those additional reserves that are less certain to be recovered than probable reserves. There is a
10% probability that the quantities actually recovered will equal or exceed the sum of proved plus probable plus possible
reserves.
6. The estimates of reserves and resources for individual properties may not reflect the same confidence level as estimates of
reserves and resources for all properties, due to the effects of aggregation.
7. Historical production data for both Zaca and Lompoc is based upon a report titled "California Monterey Reservoir Study
Project", prepared by Spivak, Mannon, Brigham, Surdam, Coombs, and Sageev and dated September 11, 1985 and the
records of the California Division of Oil and Gas and Geothermal Resources obtained by the Company on August 24, 2011.
25

26. Appendix

27. Management Team
Mike Kobler, Chairman, CEO and President
 35 years international project management and engineering experience
 Founder of successful OSUM Oil Sands Corp., Calgary
 Founder and President, UCM Civil Engineering Consulting Firm focused on large infrastructure construction projects in California
Bruce Berwager, COO - Masters Petroleum Eng, P.Eng
 32 years international oil and gas exploration, development, operations management and engineering roles with Chevron, Unocal,
Conoco, Venoco and others
 20+ years experience with Shale in California (Monterey), Texas (Barnett & Wolfcamp), Pennsylvania (Marcellus)
 Former Director and COO of Venoco, SVP and GM for California Ops-Warren Resources
Peter Ballachey, CFO and Corporate Secretary - CA, MS
 35 years experience including 16 years senior financial CFO roles in Canada and USA
 Former CFO of OSUM Oil Sands Corp., Calgary
Simon Clarke, VP Corporate Development and Director, LLB
 Over 20 years capital markets experience
 Founder, Board Observer and Advisor to OSUM Oil Sands Corp
 Managing Director Invico Energy II Fund, Director of Argus Metals Corp., Director of Underground Energy, Inc.
David Hoyt, VP Exploration & Development – CPG, RPG
 Over 35 years exploration and development geology and geophysics project management and interpretation experience with ARCO,
TXO, Warren, Foothill and as an independent consultant
 Extensive academic and Industry experience in California, Nevada, Alaska
Randy Ray, Chief Geophysicist – BS, MS
 36 years experience in Western US and an expert in integrated seismic and geological interpretation
 Professional Geologist, Texas and Wyoming
Kim Wolfe, Regulatory Manager and Compliance Officer – Paralegal, NP
 13 years oil and gas experience with Venoco, Greka, Tracer in land, legal and compliance roles
 California and Santa Barbara permitting and regulatory expert
27

28. Independent Directors
Randy Aldridge – Independent Director
 35 years international oil experience: Chairman- Koch Pipelines, President- Koch Petroleum Canada, President-Koch Oil Co.,
Chairman-True Energy Corp.
 Board Member, Energy Holdings international Inc. and Husky/BP Toledo Refinery LLC
Harland Johnson – Independent Director
 45 years technical and management experience in the upstream petroleum industry for Exxon Corporation and its affiliates
 Formerly Presidente, Divisão de Exploração e Produção, Esso Brasileira de Petróleo Limitada; and President, Exxon Trinidad Limited
 BSc (Honors) Chemistry, U of Alberta. PhD Metallurgy, U of Alberta
Andrew Squires – Independent Director
 23 years experience in heavy oil and oil sands at Petro-Canada, Dome, Amoco, Paramount
 Sr. Vice-President, OSUM Oil Sands Corp.
Douglas Urch – Independent Director
 Over 30 years oil & gas experience at RallyEnergy, Mohave Exploration, Sunshine Oilsands, Barrington Petroleum, TriGas Exploration
and Ryerson Oil & Gas
 EVP, Finance and CFO Bankers Petroleum Ltd.
 Director and Audit Committee Chairman at Petrodorado Energy
Sam Charanek – Advisor to the Board
 15 years of capital markets and finance experience with a focus on international oil and gas strategies
 Co-founder of Pan Orient Energy, Canacol Energy, Excelsior Energy (now Athabasca), PetroDorado Energy and Mena Hydrocarbons
 Advised Zodiac Exploration, Gallic Energy and ArPetrol Energy and Sunshine Oilsands
28

29. History of Monterey Shale
1895: 1st Monterey production in state at
t
1
Midway Sunset field
1901: Union discovers Monterey Fractured
play at Orcutt Field, several more Monterey
t
2
fields developed in Santa Maria Basin from
1901 - 1942
t
4
t
5 1970’s-1990’s: Majors discover large Offshore
Monterey Fractured fields-Hondo, Pt. Arguello,
t
6 t
3
Pt. Pedernales, Sacate, Pescado, S. Ellwood
fields
t
1
t
2 1980’s:Shell/Chevron/Mobil develop
t
4 Monterey Diatomite with vertical frac’d wells
at Belridge and Lost Hills fields
1990’s: EOG develops diagenetic fractured
t
5
Monterey at Rose and N. Shafter fields
t
3 7
1998: Oxy begins development of Monterey
t
6
matrix at Elk Hills field
2005-11: Oxy explores and develops
7
7 Monterey equivalent formations in Ventura
and Los Angeles Basins
29

30. Monterey Play Types
UE’s Initial Monterey Prospects are Naturally Fractured, Conventional Structures
Cat Canyon-Gato Ridge South Belridge
147 MMBO Zaca Extension 540 MMBO
21 MMBO Cuyama Elk Hills North Shafter
230 MMBO 17 MMBO
Pt. Pedernales Hondo
Orcutt
Asphaltea 86 MMBO
90 MMBO 427 MMBO
209 MMBO Closures
103 MMBO
Monterey Formation
San Andreas Fault
OFFSHORE-ONSHORE MONTEREY OUTBOUND BASINS ONSHORE SAN JOAQUIN INBOUND BASIN
Fracture Dominated Matrix Dominated
135 Miles
 Fracture Dominated
• Outward basins – Structural traps – Hondo, Pt. Pedernales, Orcutt, Cat Canyon, Asphaltea – cleaner shales
• Inward basins – Diagenetic traps – Rose, North Shafter
 Matrix Dominated: Mostly Diatomite – Belridge, Lost Hills, Elk Hills, Cymric, McKittrick
 Dual Porosity: Matrix, micro-fractures and fractures – S. Ellwood, Midway-Sunset
30

31. US Shale Oil Comparison
Formation Gross Matrix Matrix Total Organic
Play
Depth (ft) Thickness (ft) Porosity (%) Permeability (md) Content (%)
Bakken 7,000-11,000 20-150 3-12 0.005-0.2 2-18
High Profile US
Oil-Prone Eagle Ford 8,0000-14,000 75-300 3-15 <0.0001-0.003 4.7
Shale Plays
Niobrara 2,000-8,000 >150 4-8 na 5
Monterey (SMV) 3,500-10,000 500-3,500 5-30 0.0001-2 4-5
California Monterey(SJV) 5,000-13,000 500-5,000 15-30 0.0001-2 0.1-4
Resource Shale
Plays Tumey 3,000-19,000 200-700 5-10 0.001 0.9-3.2
Kreyenhagen 3,000-19,000 400-2,400 5-10 <0.0001-1 4-12
Moreno (Gas) 4,000-14,000 100-11,000 na na 0.5-4
Nevada Chainman/Pilot > 8,200 400-2,400 5-10 Fracture Enhanced 1.5-11.7
Emerging Shale
Plays Paleozoic >8,200-15,000 2,000-3,000 Fracture Enhanced Fracture Enhanced 4.4-25
Key Attributes of Commercial Resource Plays
 TOC in excess of 1%
 T-MAX of 450⁰F
 Enhanced Permeability from Interbedded Sand/Carbonates or Natural Fractures
31

32. Local Prices
based on NYMEX Futures Strip
NYMEX Futures Strip Prices as of January 30, 2012
Crude Oil Prices Natural Gas Prices
WTI @ Current Current SMV NYMEX Local Gas Local Gas
Cushing Differential Differential Crude Oil Henry Hub Price Price
Oklahoma MWSS (1) SMV (2) Forecast Differential
vs WTI vs MWSS % of
Year $US/bbl $US/bbl $US/bbl $US/bbl $US/mmbtu HH Nymex $US/mmbtu
Dec. 2012 $100.43 +$6.68 $(4.65) $102.46 $3.51 118% $4.14
2013 $97.50 +$6.68 $(4.65) $99.53 $3.99 118% $4.71
2014 $93.68 +$6.68 $(4.65) $95.71 $4.31 118% $5.09
2015 $90.75 +$6.68 $(4.65) $92.78 $4.56 118% $5.38
2016 $89.19 +$6.68 $(4.65) $91.22 $4.82 118% $5.69
2017 $88.49 +$6.68 $(4.65) $90.52 $5.11 118% $6.03
2018 $88.66 +$6.68 $(4.65) $90.69 $5.41 118% $6.38
2019 $89.00 +$6.68 $(4.65) $91.03 $5.71 118% $6.74
2020 $89.80 +$6.68 $(4.65) $91.83 $6.04 118% $7.13
2021+ $90.00 +$6.68 $(4.65) $92.03 $6.35 118% $7.49
1. MWSS is an abbreviation for Midway Sunset, the benchmark for California heavy oil at 13˚ API
32
2. SMV is an abbreviation for Santa Maria Valley crude oil at 15˚ API