American International Petroleum Appoints Dr. JackKrug Acting President of Exploration and...

Business Editors

NEW YORK--(BUSINESS WIRE)--Aug. 10, 2000

30-Year Industry Veteran Brings Kazakhstan Experience

To Company's Projects

American International Petroleum Corporation (Nasdaq NMS: AIPN) today announced the appointment of Dr. Jack Krug as acting

Chairman Dr. George Faris said, "Dr. Krug's extensive knowledge and 30 years background in the oil and gas industry, including his expertise in exploration and development in the former Soviet Union, makes him particularly qualified to lead the Company's exploration and development division. He has had key roles in the successful development of various domestic and international oil and gas projects, including heading Chaparral Resources."

Before joining the Company, Dr. Krug was the Chief Operating Officer and President of Chaparral Resources, Inc., managing the daily operations of the company and its Karakuduk joint venture in Kazakhstan. Dr. Krug was instrumental in obtaining financing for the initial stages of field development that includes plans to drill over 100 production and injection wells and the necessary infrastructure. Additionally, he has extensive working knowledge of running oil and gas companies in Russia and Kazakhstan.

Dr. Faris added, "We expect that Dr. Krug will become the formal president of the oil and gas exploration and production division once the Company appoints a permanent president/CEO of the corporation."

Dr. Krug began working in Russia and Kazakhstan in 1991 as a consulting petroleum engineer, initially traveling throughout the former Soviet Union, gathering data and evaluating joint venture opportunities for various clients. In 1992 he began directing and managing in-country the first of three joint ventures, two located in Russia and the other in Kazakhstan, in the capacity of either General Director or First Deputy General Director. During his management of these joint ventures, each was financially successful, operated self-sufficiently, and met goals while operating within budget.

Dr. Krug has co-authored a five-part series of articles in the respected Oil and Gas Journal concerning evaluating properties, forming ventures, project joint venture economics, and production sharing in Russia. Dr. Krug holds a Ph.D. degree in Petroleum Engineering from the Colorado School of Mines, is a Registered Professional Engineer and member of the Society of Petroleum Engineers, Society of Petroleum Evaluation Engineers and Society of Professional Well Log Analysts. His varied work experience encompasses company and project management, drilling, production operations, and reservoir evaluations both domestically and internationally. His background includes working for British Petroleum and various independent oil and gas companies.

The Company has accepted the resignation of Johnny Kopecky as president of the oil and gas division and entered into a consulting contract with him. Kopecky will continue to work on the engineering development and economics of License 1551.

The Company last month announced it plans to renew exploration activity on its 4.7 million acre License 953 in northwestern Kazakhstan in which the Company owns a 70% working interest. The Company will re-enter the Begesh No. 1 oil well in order to test a key Upper Jurassic interval known to be oil productive in the Karakuduk Field.

The Begesh No. 1 well re-entry and subsequent test program is designed to establish that the Jurassic formation in the Begesh structure is capable of producing oil in commercial quantity. Success of Begesh No. 1 will support further delineation of the Jurassic formation on the 12,000 acre Begesh structure and its ultimate commercial development. The Begesh No. 1 well, previously drilled, logged, partially tested and then suspended by the Soviets for future evaluation. The Upper Jurassic interval in the Begesh No. 1 well has never been tested.

The Begesh No. 1 well is less than two miles from a major oil pipeline system, thus enhancing the ability to transport and market oil from the well should satisfactory rates of production be realized.

American International Petroleum Kazakhstan, a wholly-owned subsidiary of the Company, owns two licenses in the Republic of Kazakhstan: Production License 1551, the Shagyryl-Shomyshty gas field, in which it has a 100% interest, has technically proved reserves of 604 billion cubic feet of gas as previously reported, and exploration License 953, a 4.7 million acre exploration block, in which the Company has a 70% working interest, and is independently estimated to have a potential of about 2.3 billion barrels of recoverable oil equivalent.

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 processing, marketing and transportation of a wide array of refined products, from naphtha to asphalt, in the United States.

Statements herein may be identified as forward-looking for purposes of safe harbor provisions under Section 21E of the Securities and Exchange Commission 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.