OPERATIONS

Overview

Deep Well Oil & Gas, Inc. through its wholly owned subsidiaries, Northern Alberta Oil Ltd. and Deep Well Oil & Gas (Alberta) Ltd., has at least a 90% working interest in three oil sands leases, a 100% working interest in one oil sands lease, and a 25% working interest in an additional two oil sands leases in the Peace River oil sands area of Alberta, all of these leases are contiguous. These six oil sands leases, as of August 19, 2019, cover 17,712 gross acres (7,168 gross hectares) of land. Of the six oil sands leases we are the operator on four leases where we have working interest ranging from 90% to 100%. We have applied to continue past its expiry date a portion of one lease that is expected to expire on August 19, 2019, for an additional 1,898 gross acres (768 gross hectares).

Deep Well's management believes that the Sawn Lake Heavy Oil Project is at the same pre-growth stage experienced by other heavy oil companies prior to a major period of growth.

Other operators targeting the deeper Slave Point Formation have previously drilled much of the land. Because of the earlier extensive exploration for light oil, Deep Well is able to benefit from data collected by others pertaining to the drilling of more than one-hundred wells that penetrated and partially delineated the heart of the Bluesky Formation heavy oil reservoir.