Fox Petroleum Announces Production from the Spears Gas Unit 2, Well #1 in Pecos County Texas

LONDON - January 10, 2008 - Fox Petroleum Inc. (OTCBB:FXPE) is pleased to announce natural gas production from its Spears Gas Unit 2, Well #1 in the Gomez Field, in Pecos County Texas.

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Initial test production is in the region of 2.5 million cubic feet per day, of which Fox Petroleum will take 22.5%, or over half a million cubic feet of gas per day. The revenue stream from the well should generate over $1,000,000 a year for Fox

The development of this project represents a successful start to a longer term program of drilling and workovers in this region and a realisation of Fox Petroleum’s ambition to become an Exploration and Production company with a revenue stream in its first year of operation.

Production Results

Stratco, the operating company on behalf of the group, were able to perforate a zone between 16,000 to 17,000 feet early this week. After shutting in the well for pressure build overnight, the well came back on at the increased rate of 3,600psi. Production tubing has been run and connected downhole, the kill fluids have been displaced and the well has now been opened up again for production and the commercial sale of natural gas.

Initial test production is in the region of 2.5 million cubic feet per day, of which Fox Petroleum will take 22.5%, or over half a million cubic feet of gas per day. Stratco Supervisor Tom Stratton, is currently testing flows at various choke sizes to optimize the gas flows into the sales pipeline.

“The well did not yield easily and only through the perseverance of the experienced crew under Tom, were we able to overcome the problems presented by removing a very stubborn tubing string left behind by the previous operator. This, plus the high winds and un-seasonal weather in the region, led to some delays but did not deter us from our objective, which has now been achieved. We are delighted at the results of this well and it augurs very well for the program of similar activity we have planned in West Texas for 2008.” said Fox CEO Richard Moore.

Aside from the currently producing zone, Fox still has the option to perforate several other prolific zones in the well, including sidetracking further downhole to the exciting Fusselman target.

The project began in November of 2007 and consisted of reworking of a historically producing gas well. The success of the Spears Gas Unit 2 re-entry represents a move to production status for Fox and provides a revenue source which will enhance Fox’s ability to participate in additional drilling and projects.

“The revenue stream from the well should generate over $1,000,000 a year for Fox. With this encouragement, we aim to participate in other similar small projects in 2008 with an aim to increase revenues 6 fold by the end of the year. Although the well was somewhat delayed by operational problems involving the extraction of damaged tubing, we still expect to see a five-month payback of our investment. That pleases us greatly.” said Vice President, Finance, Alex Craven.

Production Processes

Reworking this type of gas well demands a technically detailed and often difficult process. Confirming the existing data by calibrating the coordinates and geographic characteristics of the hole to the initial set of data provided by the previous well owners is the first step in the reworking process; this step is followed by replacing any damaged or deteriorated infrastructure parts.

Once at the bottom of the existing, further drilling is often required in order to reach deposits that may prove more economically feasible than previously determined. Only after all depreciated production equipment downhole and on the surface is replaced and all relevant safety checks are made on the lines, can the well be put into production.

Project Significance

The reworking of the Spears Gas Unit 2, Well #1 is the first of a possible 9 Gas Wells that Fox has the opportunity to participate in and provides the prospect of addition low risk production possibilities in the short term future.

"This project is a perfect example of the fundamentals that Fox Petroleum encompasses in every aspect of its operations, with low risk and solid income opportunities this development is a very significant step forward in the company's pursuit of large scale production and revenue generation. We’re grateful for the patience and trust our investors and shareholders have shown." states Alex Craven, Vice President of Finance about the developments.

"I am delighted that we have commenced commercial production from the Spears Gas Unit 2, Well #1. This has been a great effort by all parties concerned. I would like to thank our highly professional engineering and project team as well as our contractors and of course Trius Energy and Stratco for their involvement. This first step has allowed Fox to come of age as a gas producer, and we look forward to a further expansion of gas production from this well and the future development of the Gomez Field, in Pecos County Texas.”

"Production from a first project is monumental for a junior exploration company, and this venture allows us to demonstrate to the market and the industry that we intend to maintain an aggressive drilling program to establish Fox as a key player in the industry. Nothing else shows that we mean business more then production results" explains Fox CEO Richard Moore.

About the Spears Gas 2 Unit

The Spears Gas Unit 2, Well #1 has produced over 23BCF of natural gas, which equates to $149,500,000 at current market prices. The Unit is currently estimated to contain reserves of natural gas in excess of 16.7 Billion Cubic Feet, worth roughly $108 million. According to evaluation by Trius Energy LLC, in association with Stratco Operating Co. MC, the Spears Gas Unit 2, Well #1 could potentially produce up to 3,000 MCFGPD or greater, which is supported by a data review of the Composite Borehole Compensated Sonic Log, Gamma Ray & Sidewall Neutron Porosity Log, extensive reservoir analysis and recent field data. The Spears Gas Unit neighbors a number of leading world producers of Oil and Gas including Chesapeake Energy, Chevron, and Cimarex Energy.

Numerous wells in the immediate area have been recently re-completed with great success. Most of these wells that permeated the Fusselman & Devonian zones have had initial production of 2,500 to 3,000 MCFG per day. The most significant Fusselman Well is the Cimarex Dewitt Parke #2 Well which is approximately 3 miles NW of the Spears Gas Unit, and has a cumulative production of 7.5BCF and is currently producing 700 MCFGPD. The most significant Devonian Well is the Chesapeake Gomez South Unit which is approximately 2 miles west of the Spears Gas Unit, with a cumulative production of 22 BCF, currently producing 1,040 MCFGPD.

Further Information

Shareholders and prospective investors are encouraged to visit Fox Petroleum's website: http://www.foxpetro.com and download Fox Petroleum's Investor Summary. Please feel free to call investor relations toll-free at 1-888-369-4744 to receive a full corporate investor's package.

About Fox Petroleum

Fox Petroleum Inc. is an Oil and Gas Exploration and Production Company headquartered in London, England, the financial capital of Europe. Fox also has an operations office in Anchorage, Alaska. Fox's current targets include mineral rights to 32,000+ acres in Alaska's North Slope estimated to represent a potential of up to 160 million barrels of oil (LAPP Resources, Inc.), and the rights to a 33.33% ownership stake in a 37,000+ acre UK North Sea license which could potentially hold up to 213 million barrels of oil (TRACS International Ltd). Fox has a 22.5% carried interest in producing onshore Texan gas well, and has also signed agreements to acquire roughly 14,000 acres on the North Slope and approximately 42,000 of land onshore in the Cook Inlet containing the Catcher's Mitt Prospect. Fox has also recently signed an FIA for 46% of the 211/17 South block containing the Bourbon Prospect, estimated by Aimwell Energy Ltd to have a mid case recoverable reserve potential of 167 mmbo. The Company's shares are publicly traded on the NASD OTC BB under the ticker symbol FXPE.

On behalf of the Board of Directors

FOX PETROLEUM INC.
Alex Craven, Vice President, Finance

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Legal Notice Regarding Forward-Looking Statements

Legal Notice Regarding Forward-Looking Statements in this news release that are not historical facts are forward-looking statements that are subject to risks and uncertainties. Forward-looking statements are based on current facts and analyses and other information that are based on forecasts of future results, estimates of amounts not yet determined and assumptions of management. Forward looking statements are generally, but not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects", "aims", "potential", "goal", "objective", "prospective", and similar expressions or that events or conditions "will", "would", "may", "can", "could" or "should" occur. Information concerning oil or natural gas reserve estimates may also be deemed to be forward looking statements, as it constitutes a prediction of what might be found to be present when and if a project is actually developed.

Forward-looking statements in this news release include that our mineral rights in Alaska's North Slope is estimated to contain a potential of up to 160 million barrels of oil; that UK North Sea license which we own a 33.33% ownership could potentially hold up to 213 million barrels of oil; that the Spears Gas Well is estimated to be spudded within this quarter of 2007 or could become Fox Petroleum's first production well; that acquisition of the 22.5% joint venture interest in the Spears Gas Well could result in short term revenue, production or bookable reserves; that the revenue potential of the Spears Gas Well could cover the investment in a matter months; that Spears Gas Well could potentially produce up to 3,000 MCFGPD or greater; that the Spears Gas Well will continue to produce at the initial rates; we could potentially drill a well on the Catcher's Mitt prospect in 2008; there will be sufficient capacity in the pipeline from Catcher's Mitt if gas is produced; we will be granted rights to explore the all acreage from the relative governing bodies; the 211/17 south block is estimated to have a potential of over 0.5 billion barrels of oil; the Bourbon prospect has potential of 167 mmbo; the Liassic/Triassic Statfjord, and the Triassic Cormorant sandstone total possible reserve of 30 mmbo; the Upper Jurassic Magnus, and the Ptarmigan sandstones, represent an additional total potential of 278 and 45 mmbo; Fox may be able to tie into existing infrastructure; an exploration well is planned on 211/17 South for 2008; Fox will be able to define a well location on the acreage and drill a well in the 2008-2009 season; Fox will be able to define and drill a well on Anglesey in 2008.

Actual results may differ materially from those currently anticipated due to a number of factors beyond the reasonable control of the Company. It is important to note that actual outcomes and the Company's actual results could differ materially from those in such forward-looking statements. Factors that could cause actual results to differ materially include misinterpretation of data, inaccurate estimates of oil and natural gas reserves, the uncertainty of the requirements demanded by environmental agencies, the Company's ability to raise financing for operations, breach by parties with whom we have contracted, inability to maintain qualified employees or consultants because of compensation or other issues, competition for equipment, inability to obtain drilling permits, potential delays or obstacles in drilling operations and interpreting data, the likelihood that no commercial quantities of oil or gas are found or recoverable, successful closing of the acquisition of joint venture partnership interest in the Spears Gas Well, the 211/17 South JV, the Cook Inlet and North Slope lease acquisitions, and our ability to participate in the exploration of, and successful completion of development programs on all aforementioned prospects and leases. Additional information on risks for the Company can be found in filings on Edgar of other junior oil and gas exploration companies with the US Securities and Exchange Commission.

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For more information please contact:

Fox Petroleum Inc.
Investor Relations
Alex Craven, Vice President, Finance
Phone No: 1-888-FOX-4744 (1-888-369-4744)
Email : ir@foxpetro.com Web Url: www.foxpetro.com

Source: Fox Petroleum Inc.

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