Mr. Andrew Rees reports

WELLSTAR ANNOUNCES PROPOSED PRIVATE PLACEMENT

Wellstar Energy Corp. intends to complete a non-brokered private placement in the aggregate amount up to $500,000, consisting of 9-per-cent convertible debenture units of the company in the aggregate principal amount of up to $500,000; and a concurrent placement of up to 6.25 million equity units at a price of eight cents per unit, and up to five million flow-through units at a price of 10 cents per FT unit, for gross proceeds of up to $500,000.

Each CD unit will consist of $1,000 in principal amount of 9-per-cent convertible debentures maturing in three years, and that number of common share purchase warrants equal to one-half of the shares issuable upon conversion of $1,000 in principal amount of debentures. The principal, and any accrued and unpaid interest under the debentures will be unsecured and will be convertible at the holder's option into fully paid non-assessable common shares of the company at: (a) with respect to principal, a conversion price equal to the greater of 10 cents or the market price of the company's common shares as defined under the policies of the TSX Venture Exchange; and (b) with respect to accrued and unpaid interest at the market price of the company's common shares at the time of settlement. Each CD unit warrant will be exercisable for a period of 24 months from the date of issuance at an exercise price of 12 cents per common share.

Each unit will consist of one common share and one-half of one common share purchase warrant. Each whole unit warrant will entitle the holder thereof to purchase one common share at an exercise price of 10 cents for a period of 24 months following the closing of the unit offering.

Each FT unit will consist of one common share and one-half of one common share purchase warrant. Each whole FT unit warrant will entitle the holder thereof to purchase one common share at an exercise price of 12 cents for a period of 24 months following the closing of the FT unit offering.

A finder's fee of 8 per cent may be payable in cash and warrants in accordance with the policies of the TSX Venture Exchange. Insiders may participate in the private placement for more than 25 per cent of the offering. All securities issued in connection with the private placement are subject to a four-month hold period from the date of issue under National Instrument 45-102 and the policies of the TSX-V. Completion of the offering is subject to receipt of all regulatory approvals, including the approval of the TSX-V. Net proceeds from the offering will be applied toward the payment of current liabilities, exploration and development of the company's oil and gas properties, and for general working capital purposes.

We seek Safe Harbor.