Circumpacific Energy Corporation Enters Into Arrangement Agreement to Be Acquired by Western Petroleum Commodities Inc.

Circumpacific Energy Corporation (TSX VENTURE:CER) announces that it has entered
into an Arrangement Agreement pursuant to which all of the outstanding shares of
CER are to be acquired by a wholly-owned subsidiary of Western Petroleum
Commodities Inc. ("WPC"), a private Canadian oil and gas company, for
approximately $9.6 million, or $0.18 per share, representing a 100% premium over
CER's 12-month volume weighted average trading price.


The completion of the Plan of Arrangement is subject to the approval by 66 2/3%
of the shareholders of CER, as well as court and regulatory approval.
Drillsearch Energy Ltd. ("DLS"), which holds approximately 79.4% of CER's
outstanding shares, has entered into a Support Agreement with WPC to vote in
favour of the Arrangement.


Following the completion of the Arrangement, DLS has also agreed to purchase
CER's joint venture interest in eight exploration tenements in South West
Queensland, Australia (the "SWQ Blocks") for $1.8 million. The sale of the SWQ
Blocks is exempt from the minority shareholder approval and formal valuation
requirements under Canadian securities legislation as the purchase price and
value ascribed to the SWQ Blocks is less than 25% of the value to be paid to
CER's shareholders under the Arrangement.


The Arrangement Agreement and sale of the SWQ Blocks is the result of CER's
Board of Directors review of CER's overall business, prospects and opportunities
to enhance shareholders value and multiple parties approaching CER and DLS on an
unsolicited basis to acquire and/or merge with CER. In connection with that
review, the unsolicited proposals received from multiple parties, and in light
of DLS's ownership interest in CER, the Board established a special committee of
independent directors to review and approve any transactions involving DLS. The
full Board and all of the members of the independent committee unanimously
approved the Arrangement with WPC as being fair and reasonable and in the best
interest of all CER shareholders.


Jim McKerlie, the Chairman of CER, stated "This is a great result for the
shareholders of Circumpacific providing them with full liquidity at an
attractive acquisition premium."


Further details regarding the Arrangement will be set out in the Information
Circular to be disseminated by CER for the meeting of the shareholders to be
held in late October to approve the Arrangement.