Universal Energy Corp.

Universal Energy Corp. (OTCBB: UVSE) is an independent diversified energy company engaged in the acquisition and development of crude oil and natural gas leases in the United States and Canada. The company pursues oil and gas prospects in partnership with oil and gas companies with exploration, development and production expertise. Their prospect areas consist of lands in Alberta, Canada, Louisiana and Texas.

Universal invests in prolific areas within the United States and Canada by acquiring low risk in-field oil and gas rights that offset existing production. The Louisiana prospects the company is currently drilling this summer, include properties that contain proven but undeveloped reserves analyzed by 3-D Seismic surveys and other research techniques to help lower drilling risks.

Oil & Gas Development Universal Explorations Inc.

Universal is engaged in nine oil and gas lease prospects at this time. These are the Amberjack, Caviar (4 prospects), Lake Campo, East OMG, Lone Oak and the Pembina Nisku Reef prospects.

Gas Deposit Struck on First Well

On Sept. 6, drilling at the Amberjack prospect reached its planned total vertical depth of 10,600. "This marks an important day for Universal. We are pleased that drilling has now been completed," commented Billy Raley, Universal Energy Corp. CEO.

The objectives of the well as defined by 3-D seismic are gas zones with total potential reserves of 10.3 billion cubic feet equivalent of gas. These objectives are located between 10,200 and 10,600 feet. During the drilling process, as expected, gas was encountered at the depths defined by 3-D seismic.

Currently, the well is being tested using electronic measures to fully determine what amount of pay will be realized from the well. "Proving up our reserves is an important and vital step to the success of Universal," commented Billy Raley. Raley concluded, "Our results from the drilling are sooner and better than anticipated."

Commenting on the drilling results Dyron Watford, CFO of Universal Energy Corp. stated, "Our ability to drive revenue from this prospect beginning this year is exciting."

Continued Drilling Success

Universal Energy announced in late September that the Caviar #1 prospect in Plaquemines Parish, Louisiana has successfully lived up to its high tech analysis. At its Caviar #1, the second prospect of six planned in the prolific Louisiana area, Universal Energy has completed installing the "casing" in preparation for production as a multi-zone gas well.

Billy Raley, CEO of Universal Energy Corp., stated, "The success of our first two drills from the summer/fall series has proven that the technology and research preparation prior to drilling certainly pays off. This continued success of our ongoing drilling program demonstrates the strength of our prospects and the growth potential of our company through the production from our ground assets. Given the current political climate with the Middle East, I think we all agree that domestic oil and gas sources like ours are becoming more critical to our nation's future every day."

EAST OMG Project Commencement of Drilling

Universal Energy announced in early October that drilling at the East OMG prospect in Cameron Parish, Louisiana is expected to begin within the two weeks.

"Drilling operations have moved swiftly over the past few weeks," commented Billy Raley CEO of Universal Energy Corp, when asked about Universal Energy Corp.'s drilling schedule. Raley continued, "We are completing the necessary steps to bring Amberjack and Caviar #1 to production while preparing for what is expected to be huge profits from East OMG."

Disclosure: Pentony Enterprises LLC has been compensated $215,000 by the company for profile coverage. Pentony Enterprises is not a registered investment adviser or a broker/dealer. Pentony Enterprises LLC makes no recommendation that the purchase of securities of companies profiled in this web site is suitable or advisable for any person, or that an investment in such securities will be profitable. In general, given the nature of the companies profiled and the lack of an active trading market for their securities, investing in such securities is highly speculative and carries a high degree of risk. Pentony Enterprises has acquired fifteen thousand shares in the open market to hold for no less than thirty days.

Prospects

Amberjack Prospect

The Amberjack 3-D Prospect is an amplitude supported, 10500’, normal pressured, drilling venture located in inland waters of Plaquemines Parish, Louisiana. The project targets multiple Middle Miocene (Tex-W, Big-H) sands on a well defined structural closure. This test is surrounded by quality, mature, fields which define the prolific nature of the objective section. Reserve potential for the prospect is 10.7 BCFE, with an expected flow rate of 5-8 MMCF/D.

The Amberjack Prospect is an opportunity to test a amplitude of exceptional quality on a tightly controlled and well defined up-thrown structural closure. Nearby well control provides very positive sand control and geophysical calibration which significantly reduces risk. The prospect sits in a fairway outstanding production from numerous fields which provide excellent production and geophysical analogies.

Caviar Prospect

The Caviar 3-D Package is a multi-well, amplitude supported exploration project located in the shallow inland waters of Plaquemines Parish, Louisiana. The four 3-D prospects, which are located within 5 miles of each other, are normal pressured, Middle Miocene (Cib-Carst, Tex-W) tests with objectives between 9,000’ and 11,000’. Numerous prolific fields in the immediate area, such as Pointe a la Hache (175 BCF and 15 MMBO), Delacroix Island (230 BCF and 24 MMBO), and Black Bay (169 BCF and 164 MMBO) produce from this sand section. Reserve potential for the entire project is 4.7 MMBOE.

The Caviar 3-D project is an opportunity to drill four well defined structural closures with multiple amplitude anomalies in an established prolific trend. The amplitude anomalies have the characteristics necessary to classify them as exceptional including high amplitude, structural fit, regional productive analogs and AVO. Each prospect has multiple regionally consistent sandstone objectives which combine to provide significant reserve upside.

Lake Campo Prospect

The Lake Campo Field Prospect is an amplitude supported, 3-D development project located 23 miles Southeast of New Orleans, Louisiana in the shallow inland waters of Plaquemines Parish. This 10,100’ normal pressured Middle Miocene (Tex-W) age test involves further development of Lake Campo Field which has to date produced 25 BCFE. The 3-D seismic indicates the top of this productive structure has not been tested in ten sands between 8400’ and 9800’. Three of these sands are established producers with water drive support and can be considered low risk objectives. Three of the remaining six objectives have associated amplitude anomalies.

The Lake Campo Field prospect is an opportunity to use recent 3-D seismic technology to further develop a water drive gas field developed in the early 1960’s that has to date produced 25 BCFE. This low risk prospect targets ten high quality, regionally consistent Miocene age sand objectives of which three are attic gas objectives, three are amplitude anomaly objectives, and four are structural objectives. The abundant well control provides the positive sand story and it combined with the 3-D seismic clearly defines the structural picture and the location of the critical trapping fault.

Pembina Nisku Reef Prospect

In September 2006, Universal Energy Corp. acquired the Pembina Nisku Reef project from 1097885 AB. Ltd. situated in the Pembina oil field in an area that is concentrated with Nisku Pinnacle Reef occurrence. The company will earn a 95% working interest in these leased lands by drilling a test well to the base of the Nisku formation, subject to a convertible 15.0% GORR. They are currently reviewing 3-D seismic and performing telluric data testing on this project. The allowable 160 acre spacing does permit for up to three wells to be drilled on these lands.

EAST OMG Prospect

Yuma’s East OMG 3D prospect is located in Cameron Parish, Louisiana. This prospect is adjacent to but separated by one large fault from the 500+BCFE Chalkley Miogyp field, which produces from the same Upper Miogyp sandstones that are the main objective of the East OMG Prospect. Yuma’s proposed, slightly deviated, 16,500’ (TVD) well will not only test the Upper Miogyp, but also an AVO supported Camerina structure 400’ high to logged pay on water in a flank well, and a shallower Marg Howei structure that appears to have been proven productive by a well that logged and tested pay, but had completion problems. These shallower Camerina and Marg Howei objectives represent viable, arguably PUD drilling objectives that greatly reduce the risk associated with the prospect. The combined reserve potential of the four principal objective sandstones that comprise the East OMG prospect is estimated to be greater than 59 BCFE.

In generating the East OMG prospect, Yuma utilized approximately 200 square miles of 2003 vintage reprocessed 3D Pre-Stack Time Migrated seismic data, that was then reprocessed in 2006 by Yuma (using Tricon) to create a proprietary PSTM volume. This reprocessed data has greatly improved the structural resolution of the prospect and also allowed for AVO evaluation of the Camerina objective. Yuma has secured all of the acreage necessary to control this prospect. Participants will have access to 12 square miles of this data to evaluate this relatively low risk, yet large up side, opportunity of Yuma’s offices.

Yuma has a history of exploration in this area and in September 2005 made a discovery on its “OMG” prospect, approximately 1.5 miles northwest of the proposed East OMG drill site; this well is currently producing out of the Lower Miogyp.

Lone Oak Prospect

Universal Energy announced, in mid-September, that the Company has entered into a participation agreement for a major oil and gas prospect in Texas.

The prospect, known as Lone Oak, is a 3-D drill ready prospect with enormous potential. With this agreement, the company has acquired a 12.5 percent interest before casing point of this prospect with total potential reserves exceeding 136 billion cubic feet equivalent ("BCFE").

The 3,526 acre Lone Oak Prospect is located in the prolific Frio-Vicksburg trend of Chambers and Galveston Counties, Texas. This area (Houston Salt Basin) is where over 4 trillion cubic feet of gas and 4 billion barrels of oil have been produced since 1900. Lone Oak is nine miles northeast of Eagle Bay Field which has produced over 110 billion cubic feet of gas and 10 million barrels of condensate from the Vicksburg sandstone reservoirs. The multiple objectives of Lone Oak are the same Vicksburg sandstone reservoirs produced at Eagle Bay Field as well as other fields within the trend.

Disclosure: Pentony Enterprises LLC has been compensated $215,000 by the company for profile coverage. Pentony Enterprises is not a registered investment adviser or a broker/dealer. Pentony Enterprises LLC makes no recommendation that the purchase of securities of companies profiled in this web site is suitable or advisable for any person, or that an investment in such securities will be profitable. In general, given the nature of the companies profiled and the lack of an active trading market for their securities, investing in such securities is highly speculative and carries a high degree of risk. Pentony Enterprises has acquired fifteen thousand shares in the open market to hold for no less than thirty days.

Oil Industry

Demand for Oil

The demand for oil in the United States is showing no signs of slowing down. In fact, it’s quite the opposite.

Global demand is on the same pace.

With many oil producing countries in decline, new supply has been slow coming to market causing the beginning of a drastic increase in the price of barrel of oil. The following graph, adjusted for inflation, shows just that:

China & India Demand

Growth in the Chinese and Indian economies has helped push world oil prices to record highs and most analysts suggest that this is not just a “passing phenomenon.” Within China, government price adjustments have helped consumers with the jump in energy costs. How long China can subsidize their consumers, no one knows. The IEA estimates that China and India will account for 40 percent of worldwide growth in oil demand this year. This graphic shows just how the economic growth in China is affecting overall worldwide demand:

Search for Oil

The United States had 21.4 billion barrels of proved oil reserves as of December 31, 2004, the eleventh highest in the world according to the US Energy Information Administration’s 2004 Annual Report on U.S. oil and natural gas reserves.

Eighty percent of the entire United States reserves are concentrated in four states:

• Texas 22%
• Louisiana 20%
• Alaska 20%
• California 18%

Universal Energy Corp. is currently concentrating their efforts on oil properties in Texas and Louisiana based on favorable economic and environmental/regulatory trends.

In addition to searching for Oil in within the United States, Universal views the province of Alberta as a prime area for drilling operations. Currently, Canada is one of the largest net importers of oil into the United States (approximately 1.6 million bbl/d). The chart below represents a list of the importers into the United States:

Based on the political problems associated with the importers listed above, Canada, due to its proximity and political stability, will provide excellent opportunities for the company's drilling operations.

In light of two recent political developments, domestic drilling prospects now become even more essential for the future of the American oil supply. On June 19th, Iran issued a threat to cut off oil exports to the U.S. in retaliation of U.S. Government demands that they cease nuclear testing. In Washington, Congress has been working to pass legislation that will allow the U.S. to sue the OPEC oil producers for price manipulation. Both actions would drive up oil prices, decisively, over the current nine-month highs, and immediately reduce supply.

Disclosure: Pentony Enterprises LLC has been compensated $215,000 by the company for profile coverage. Pentony Enterprises is not a registered investment adviser or a broker/dealer. Pentony Enterprises LLC makes no recommendation that the purchase of securities of companies profiled in this web site is suitable or advisable for any person, or that an investment in such securities will be profitable. In general, given the nature of the companies profiled and the lack of an active trading market for their securities, investing in such securities is highly speculative and carries a high degree of risk. Pentony Enterprises has acquired fifteen thousand shares in the open market to hold for no less than thirty days.

Management

Billy Raley Chief Executive Officer

Mr. Raley serves as the CEO of Universal Energy Corporation (UEC), a diversified energy company currently focused on oil and gas exploration. He previously held the position of Regional Vice President for Progress Energy Florida, Inc., a Progress Energy Company where he was responsible for operations and community relations throughout a six-county area in Central Florida. His team consisted of 400 company employees and 200 contract employees, most of who were responsible for distribution construction and operations to nearly 400,000 customers.

Prior to joining Progress Energy Florida in 2002, he was the Vice President of Transmission for Carolina Power & Light, also a Progress Energy Company. In that position he was responsible for the construction and maintenance of all transmission facilities in North and South Carolina. He also provided oversight for all transmission engineering and maintenance for the Florida transmission system. Mr. Raley’s background is comprised of over 25 years of electric utility industry experience, including expertise in the areas of Transmission and Distribution Operations, Construction and Maintenance, and Nuclear Generation.

Mr. Raley currently serves as a trustee of Stetson University and is the Chairman of the Foundation Board of Seminole Community College. He also serves on the Board of Directors of the Florida Blood Centers and the Cystic Fibrosis Executive Committee. He is a member of the Board of Directors and is Chair-Elect of the Seminole Regional Chamber of Commerce.

Mr. Raley was recently awarded “Business Person of the Year” for Seminole County.

Prior to joining Progress Energy, Mr. Raley spent his first twenty years working for the Southern Company where he began as a system protection engineer and rose to become manager of transmission line construction and design. During his time with Southern Company, he also managed nuclear maintenance engineering and transmission maintenance. He is a Dean’s List graduate of the Georgia Institute of Technology with a degree in Electrical Engineering. In addition, Mr. Raley is a member of IEEE as well as having served on the NESC main committee and AEIC EPAC committee.

Mr. Raley and his wife Melodie live in Lake Mary with their three daughters: Malia, Bethany, and Eden.

Dyron M. Watford Chief Financial Officer

Mr. Watford, a Certified Public Accountant, was appointed to serve as our Principal Accounting Officer and was elected to serve as a director of the company in November 2002. Since August 2000, Mr. Watford has served as the president, sole stockholder and director of Sirus Capital Corp, Inc., a consulting company providing financial services to existing and emerging private and public companies. From December 1998 to August 2000, Mr. Watford was an auditor for Arthur Andersen, LLP. Mr. Watford obtained a Master of Business Administration degree from the University of Central Florida in December 1998.

Kevin Tattersall Chief Exploration Officer

Mr. Tattersall has over 25 years of experience in the resource exploration business with the last 10 years being focused on the oil and gas industry. Mr. Tattersall’s resource exploration experience began in the late seventies where he worked for many years in the field as a geophysical/ geochemical exploration consultant for various mining companies. His duties included applying magnetic and induced polarization field surveys along with intensive soil geochemistry sampling programs.

In 1986, Mr. Tattersall began to diversify his educational and business efforts in the oil and gas industry. Mr. Tattersall’s interest to incorporate and learn the business and technical aspect of the oil & gas exploration industry was a natural progression. In 1987, he attained the position of Exploration Manager for Big Valley Resources Inc. and thereafter on to Vice President of Corporate Finance. There Mr. Tattersall assisted the company with financing requirements on their initial public offering. In total, Mr. Tattersall and his associates raised approximately $10,000,000 via private placements and various brokerage house financings. The efforts and investment capital raised allowed Big Valley Resources to jointly discover the now producing Imperial Metals, Mount Polley Copper Gold Mine in Central British Columbia Canada.

In addition, Mr. Tattersall is currently the president and chief executive officer of Angels Exploration Fund Inc., a drilling investment fund that has been successful in financing numerous tax deductible drilling programs for natural gas exploration in Northern Alberta. Mr. Tattersall was VP Operations for Maverick Resources Inc., a private Oil and Gas exploration company based in Calgary Alberta from 2000 to 2005. Mr. Tattersall consults in the field as an independent drilling and completions consultant applying the latest drilling and completion techniques used in the oil & gas fields of Alberta and northeastern British Columbia. Mr. Tattersall is certified in basic reservoir engineering through OGCI Tulsa Oklahoma as well as being certified in oil & gas drill site supervision and well completions through the Petroleum Institute of Calgary Alberta.

Disclosure: Pentony Enterprises LLC has been compensated $215,000 by the company for profile coverage. Pentony Enterprises is not a registered investment adviser or a broker/dealer. Pentony Enterprises LLC makes no recommendation that the purchase of securities of companies profiled in this web site is suitable or advisable for any person, or that an investment in such securities will be profitable. In general, given the nature of the companies profiled and the lack of an active trading market for their securities, investing in such securities is highly speculative and carries a high degree of risk. Pentony Enterprises has acquired fifteen thousand shares in the open market to hold for no less than thirty days.

Disclosure: Pentony Enterprises LLC has been compensated $215,000 by the company for profile coverage. Pentony Enterprises is not a registered investment adviser or a broker/dealer. Pentony Enterprises LLC makes no recommendation that the purchase of securities of companies profiled in this web site is suitable or advisable for any person, or that an investment in such securities will be profitable. In general, given the nature of the companies profiled and the lack of an active trading market for their securities, investing in such securities is highly speculative and carries a high degree of risk. Pentony Enterprises has acquired fifteen thousand shares in the open market to hold for no less than thirty days.

Contact Info

Universal Energy Corp.

30 Skyline Drive
Lake Mary, FL 32746

Phone:

(800) 975-2076

Fax:

(800) 805-4561

Fax:

Dyron M. Watford, CFO - dwatford@universalenergycorp.info

Website:

www.universalenergycorp.info

Disclosure: Pentony Enterprises LLC has been compensated $215,000 by the company for profile coverage. Pentony Enterprises is not a registered investment adviser or a broker/dealer. Pentony Enterprises LLC makes no recommendation that the purchase of securities of companies profiled in this web site is suitable or advisable for any person, or that an investment in such securities will be profitable. In general, given the nature of the companies profiled and the lack of an active trading market for their securities, investing in such securities is highly speculative and carries a high degree of risk. Pentony Enterprises has acquired fifteen thousand shares in the open market to hold for no less than thirty days.