American International Petroleum Corporation (NASDAQ) to commence construction of Asphalt facility; Company obtains a firm $6 million commitment to finance project; Company signs MOU with major industry marketer and refiner to market its asphalt.

NEW YORK--(BUSINESS WIRE)--June 18, 1996--AMERICAN INTERNATIONAL PETROLEUM CORPORATION (NASDAQ:AIPN), announced today that it has received a firm $6 million loan commitment from Venture Guarantee Group of London, England. The loan proceeds will be used primarily to fund the expansion and implementation of the Company s 20,000 barrel-per-day modified vacuum distillation unit ( VDU ) at its Lake Charles, Louisiana refinery. The VDU will be operated as a stand-alone unit to produce asphalt, vacuum gas oil and diesel and it will be operated in addition to, but separately from, the 30,000 barrel- per-day crude unit at its refinery, which it leases to another company.

The Company has obtained the permits necessary to expand the main tank battery at the facility and has signed a Memorandum of Understanding with a major industry marketer and refiner to market the Company s asphalt production and to utilize the company s facilities as an asphalt terminal.

The $6 million, 10% bond, is to be funded in three traunches with the first $2 million scheduled on June 28, 1996, the second $2 million on September 30, 1996 and the last $2 million by October 30, 1996. Venture Guarantee arranged for $2 million in financing for the Company earlier this year and, together with its affiliate Select Capital Advisors of Miami, Florida, have been instrumental in concluding a number of financings, both domestic and foreign totaling in excess of $100 million over the past 5 months.

Independently prepared economic models indicate that, depending upon the level and type of daily feedstock processed, the annual revenues from the Company s VDU project could range from $20 to $70 million, with attractive operating margins, mainly because the modified VDU is able to utilize lower-cost heavy crude oils as feedstock and because the facility will be able to provide polymerized, as well as conventional asphalt. The production of polymerized asphalt would significantly increase the revenues (and margins) mentioned above.

The Company hopes to begin a terminalling operation in the fourth quarter of 1996 and implement the production of asphalt and other products in the second quarter of 1997. It intends to immediately hire a new President to run its VDU and refining operations.

American International Petroleum Corporation is engaged in oil and natural gas exploration and production in Colombia, Peru, South America, and in refining in Louisiana.

CONTACT: Denis Fitzpatrick

Chief Financial Officer

(800) 298-AIPC