TEMPLE MOUNTAIN ENERGY, INC.

Temple Mountain Energy, Inc. (“TME”) is an oil sands mining and processing company with a mineral lease and operations near Vernal, Utah in one of the largest oil sands basins in the United States. TME has full control of 1,300 acres at the “Asphalt Ridge” lease site, which is one of only two oil sands operations in the U.S. that is fully permitted to operate under a “large mine” permit today. The Asphalt Ridge area has been assessed as having over 1 billion barrels of estimated oil reserves. This classifies the deposit as a “giant” under the US Geological Survey’s (USGS) oil sands classification system.

TME’s mining and processing project began at the Asphalt Ridge site in 2006. Oil-bearing sand veins near the ground’s surface are extracted using traditional, well-established surface-mining techniques to yield raw ore that is 6% - 15% (or more) oil by weight, with the balance being sand. TME estimates its reserves at Asphalt Ridge to be 150 million barrels of oil, of which 80 million barrels are surface-recoverable. The remaining 70 million barrels can be recovered through in situ extraction.

At ambient summer temperatures, oil at Asphalt Ridge flows naturally from the outcroppings near the surface.

The U.S. government has recognized the national importance of domestic unconventional oil resources like Asphalt Ridge by including oil sands and oil shale as “strategic fuels” in the Energy Act of 2005. As such, Asphalt Ridge has the potential to be a significant contributor to U.S. energy independence.

TME’s Asphalt Ridge project avoids the most negative environmental factors associated with oil sands projects in other regions. This is largely because TME’s oil sands are able to be surface-mined above-ground, thus avoiding high-energy-consuming processes used elsewhere (such as SAGD), and thereby greatly reducing greenhouse gas emissions, such as CO2, per ton of oil sand processed, while yielding a high "energy balance." In fact, the Asphalt Ridge operation has a near-zero carbon footprint. Mined lands at Asphalt Ridge also undergo a thorough reclamation process to ensure they are returned to good environmental condition following mining.

Opening up the mine with blasting and a D-9 CAT that is the third-largest CAT made.

Once mined, TME’s oil sands ore can be used in the following ways:

     ·     Sold “as-is” for road asphalt, without any further processing (screening optional)
     ·     Processed on-site into road asphalt binder (bitumen), a value-added product in high demand
     ·     Upgraded to sweet crude for sale to oil refiners
     ·     Sold as clean, high-quality sand (a byproduct of the oil separation process) for applications such as hydraulic fracturing (for oil & gas production), glass-making and other industrial uses

The vast majority of the components of the ore mined at Asphalt Ridge are valuable and marketable products. Very little is wasted or non-marketable.

TME's Asphalt Ridge project has very attractive economics. Operating margins are approximately 40% when crude oil is trading at $80 per barrel (including the sale of asphalt binder, extraction byproducts and raw "native ore" (asphalt)).

The total TME reserve deposits at Asphalt Ridge (estimated to be 150 million barrels) were extensively documented by a previous large corporate owner of the lease, Standard Oil of Ohio (SOHIO later became Amoco), which abandoned its oil sands project and the acreage in the late 1980s after crude oil prices dropped to around $10/barrel. At today’s oil prices (generally $75/barrel or more), TME’s economics are quite attractive, exceeding the break-even point by a wide margin.

The Asphalt Ridge project is expected to have a total lifetime of 25-30 years after expanded production (planned for 2012-2013) occurs.