Dusty Mac Oil & Gas makes announcement.

VANCOUVER, British Columbia--(BUSINESS WIRE)--Feb. 3, 1995--In pursuing its objective to develop its oil and gas prospects in the Permian Basin, the Company is pleased to announce that its subsidiary Dusty Mac Resources Inc. ("Dusty") has entered into an operating agreement with Ultra Petroleum (USA) Inc. ("Ultra"), Arrowhead Resources (USA) Ltd. ("Arrowhead") and Tom Brown Inc. with respect to lands situate in Lea County, New Mexico and Winkler County, Texas, from the surface to 100 feet below the base of the Bone Springs formation.

The operating agreement provides that the entire contract area will be divided into 40 acre offsetting tracts, commencing with the NE/4 NE/4 of each section, which is referred to as the "Black" tract and continuing with the NW/4 NE/4 of each section, referred to as the "Red" tract and so on, throughout each section so that each section be divided into eight Black tracts and eight Red tracts. The interests of the parties in each of the Black tracts and the Red tracts are as follows: -0-

                                                     First Black Tract
                                 First Black Tract   in Each Section
                                 in Each Section     After Casing Point
Party and            Red Tract    Through Casing     and all other Black
Interest             (NWI)        Point (GWI)        Tracts (NWI)

Ultra Petroleum
(USA) Inc.            4.25%           55.00%              42.50%
Dusty Mac
 Resources Inc.      63.75%           23.68%              33.55%
Arrowhead Resources
 (USA) Ltd.          17.00%            6.32%               8.95%
Tom Brown            15.00%           15.00%              15.00%
TOTAL:              100.00%          100.00%               100%

Dusty and Ultra have been designated as joint operator on the Black tracts. Dusty will be designated as operator on the Red tracts. If Ultra elects not to participate in a well proposed on the Black tract, it shall be deemed to have resigned as operator of such tract.

Under the operating agreement, the parties have created an area of mutual interest which covers all lands within six miles of the outer perimeter of the contract. Should any party acquire any interest in oil and gas leases within 5 miles of the outer perimeter of the AMI, it shall offer the remaining parties the right to acquire a working interest equal to their respective working interest in the second and subsequent Black tract in each section.

The Company further wishes to announce that it has entered into a letter of understanding with each of Arrowhead and Ultra with respect to the South Evetts prospect. The agreement provides that each of Arrowhead and Ultra will be assigned a one-third interest in and to the initial leases on the prospect earlier acquired by Dusty. Additional acreage to be acquired on the prospect by Ultra will be assigned to each of Dusty and Arrowhead on an equal one-third interest basis. Dusty shall be carried on all lease acquisition and drilling costs, in respect of any initial test well drilled on the prospect, up to that amount which is equal to 66.6% of its initial lease acquisition costs.

The Company further wishes to announce that Dusty has entered into a letter of understanding with each of Arrowhead and Ultra, whereby they will each be assigned a one-third interest in and to the exploration agreements signed by Dusty and Donald T. Metcalfe relating to the West Texas Pool SEIS/I program and the Western Margin Central Basin Platform Program. Under the terms of the agreement, it is intended that each of Arrowhead, Dusty and Ultra will work in a strategic alliance with Synterra Exploration Group and Donald T. Metcalfe in an effort to develop large reserve gas prospects in the Delaware Basin and the Western Margin of the Central Basin Platform.

The Company further wishes to announce that it has accepted the resignation of Mr. Robert Rohlfing as Senior Vice President (Southeast Asia and Alaska). Mr. Rohlfing has assisted the Company in its negotiation with Petro Vietnam, but due to the conflict raised by the potential obligation of the Company to pay a bonus or finder's fee to a company in which Mr. Rohlfing is principle, Mr. Rohlfing resigned. The Company will continue to work with Mr. Rohlfing on an arm's length basis in its negotiations on the Vietnam Prospect.

On Behalf of the Board of Directors of

DUSTY MAC OIL & GAS LTD.

George H. Laycraft

President

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THE VANCOUVER STOCK EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ACCURACY OF THIS NEWS RELEASE.

CONTACT: Dusty Mac Oil & Gas Ltd.

George H. Laycraft, 604/683-2568