American International Petroleum Revises Potential Recoverable Reserve Estimates for Its Kazakhstan License.

NEW YORK--(BUSINESS WIRE)--December 9, 1998--American International Petroleum Corporation (Nasdaq NMS: AIPN) announced revised potential gross recoverable reserve estimates for its Kazakhstan License of 2.3 billion barrels of oil equivalent from the Eocene and Jurassic sections with estimated potential gross recoverable reserves of 1.98 billion barrels of oil and 2.15 trillion cubic feet of gas. The independent evaluation, provided by the petroleum engineering consulting firm Huddleston & Co., used a 15% recovery factor for oil and a 65% recovery factor for gas from more than twenty large anticlinal structures.

Company Chairman and CEO Dr. George Faris said, "The Company is very encouraged by this revised evaluation as it revalidates our belief in the significant potential of our License. We are currently drilling Altai No. 1 to a depth of about 3,000 feet to test the gas bearing upper Eocene section and are actively in discussions with various industry partners for marketing gas. The Company is also seeking contractual arrangements for infrastructure development should results of Altai No. 1 support commercial development."

Huddleston developed its evaluation from geological interpretations obtained from new and previous 2D seismic data interpreted by Wavetech Geophysical Inc and from a petrophysical evaluation prepared by ResTech Reservoir Evaluation Services. The current estimate of potential oil and gas reserves, which are not risk adjusted, were based on volumetric calculations with reservoir parameters derived from the WaveTech and ResTech studies. This revised estimate represents a downward revision from a previous estimate of 2.75 billion barrels of potential oil equivalent reserves estimated by Huddleston, and subsequently disclosed by the Company.

The revised evaluation utilized information developed from 907 kilometers of 2-D seismic data acquired by the Company during 1998 at a cost of approximately $6,000,000. The newly acquired seismic data is superior to data previously available, providing enhanced definition and more detailed imaging of the deep Carboneferous section, as well as the Eocene and Jurassic sections. The evaluation also included reprocessing more than 1,100 kilometers of older Russian 2-D seismic data and certain logs of existing wells previously drilled during the Soviet regime. Huddleston did not provide an estimate of potential reserves for the thick Carboneferous section in the Greater Chikuduk structure whose rocks are age equivalent to the 8 billion barrel Tengiz oil field 80 miles northwest of the Company's License since no wells have been drilled in that section.

The Company has a 70% working interest in its License No. 953 that covers 4.7 million acres in Western Kazakhstan.

American International Petroleum Corporation is a diversified petroleum company which, through various wholly owned subsidiaries, is involved in oil and gas exploration and development in Kazakhstan, and in refining, marketing and transportation of petroleum products in the United States.

Statements herein may be identified as forward-looking for purposes of safe harbor provisions under Section 21E of the SEC Act of 1934. Such statements relating to the Company's future business are subject to risks and uncertainties that could cause actual results to differ materially from those statements, and other risks and factors, identified in the Company's SEC filings.