American International Petroleum Signs Protocol to Jointly Develop Kazakhstan Gas Field With Tyumen Oil.

Business Editors

NEW YORK--(BUSINESS WIRE)--Dec. 21, 1999

American International Petroleum To Remain Operator

American International Petroleum Corporation (NASDAQ NMS: AIPN) announced today that it has entered into a protocol to form a joint venture for the financing and development of License 1551 in Kazakhstan with Tyumen Oil Company, one of the leading oil and gas companies in Russia.

The protocol calls for Tyumen to provide a cash payment to AIPC plus assist the Company in raising its share of the development cost, if necessary by issuing its guaranties. In exchange, Tyumen will receive a one-half interest in the License and assume responsibility for providing one-half of the cost of its development. American International Petroleum will be the operator of the License and Tyumen will provide key technical and supervisory personnel to facilitate the low cost and expedient development and operation of the gas field and associated facilities.

Tyumen Oil Company is the third largest integrated oil company in Russia with full exploration, production, refining, and distribution arms. License 1551, located in western Kazakhstan, has estimated proved gas reserves of approximately 450 billion cubic feet and approximately 500 billion cubic feet of probable reserves. It is expected that the field will deliver 500 million dollars of revenue in the first seven years of production.

Joe Michael McKinney, Chief Executive Officer of American International Petroleum, commented on this agreement as follows, "Tyumen's size, financial depth and operating experience in this geographic region should improve our efforts to commercialize this significant gas field. We believe that Tyumen's entering into this protocol is indicative of their confidence in the final outcome of the License's gas sales contract."

Mr. McKinney continued, "Concerning the gas sales agreement, AIPC and Gazprom have elected to bypass the protocol stage and proceed to a formal agreement. Because of the greater detail involved and the intervention of a lengthy seasonal holiday in Russia, it is expected that the formal agreement will be closed in the first quarter of 2000."

About Tyumen Oil Company (TNK):

TNK, by total reserves, is ranked third in the country. According to Tyumen, and supported by the independent petroleum engineering firm, Miller & Lents, as of January 1, 1999, Tyumen's net oil reserves exceeded 4.3 billion barrels. By production volume, in the first six months of 1999, TNK has been ranked fifth in Russia. At the end of 1998, the Company employed almost 40,000 people. The Company is one of the few Russian oil companies with nearly full production capacity utilization.

About American International Petroleum Corp.

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 the Republic of Kazakhstan, and in refining, marketing and transportation of its refined products in the United States.

The Company's wholly-owned subsidiary, American International Petroleum Kazakhstan, owns two licenses in the Republic of Kazakhstan: License 1551, the Shagyryl-Shomyshty gas field, in which it has a 100% interest, has technically proved reserves of 450 billion cubic feet of gas as independently estimated by Ryder Scott Co., and License 953, a 4.7 million acre exploration license, in which AIPC has a 70% working interest.

The matters discussed herein may be deemed forward-looking statements. These statements involve risks and uncertainties, such as timely availability of products and services, as set forth in the Company's filings with the Securities and Exchange Commission. These risks and uncertainties could cause actual results to differ materially from any forward-looking statements made herein.