The third quarter of 2013 was considered the initial implementation period for Treaty Energy Corporation’s (“the Company”) new oil and gas development strategy. The second quarter of 2013 marked the transition period in which the company liquidated certain assets, cut expenses and developed its future plans of operation. In the third quarter of 2013, the Company began a new primary operations strategy in Texas.

Change in Operations and Revenue Generation

The Company has changed its primary operations focus to west Texas in an attempt to increase the Company’s revenues and decrease outstanding liabilities. The Company’s efforts in west Texas have been notably successful and have prompted this operating change.

The new west Texas drilling plan is as follows:

1.	Partner with a drilling partner to determine the possible production potential of a believed to be underdeveloped oil and gas lease, decreasing initial oil and gas exploration costs by at least 50%.

2.	Receive data and initial production revenues from the lease to further potentially develop other leases in the area.

3.	Develop and sustain operations on the exploratory lease temporarily while simultaneously building a list of possible vendors, operators and landowners in the area willing to work with the Company on future projects.

4.	Find a lower cost and reputable drilling partner in the local area and expand drilling operations to other leases acquired during the temporary exploratory lease.

5.	Once completed, either sell ownership interests or produce any and all new wells.

After successfully drilling two wells on the Mitchell lease (wells #3 & #4) in Tuscola, Texas. The Company was able to determine the profitability and possible production potential of the Taylor County Regular field. During the months of June-September a total of approximately 3,895.25 gross barrels of oil were sold (before oil docking) off of the Mitchell lease resulting a gross revenue of $380,484 before overriding royalty, interest splits and well completion/operations costs. During the 4 th quarter of 2013, these two wells were sold to an investor.

The Company recently drilled two additional wells on the adjacent Stockton Lease where it has completed one well and plans to perform well completion operations within the next 30 days on the second well (if not already done by the time of this document’s release).

During this time the Company’s revenue stream has changed. After the success of the Mitchell lease, the Company recognized the investment demand for “turn-key” oil and gas properties. Recognizing shareholder concerns regarding immediate cash-flows, the Company plans to fully develop a well from start to finish and then sell the Company’s Net Revenue Interests and Working Interests on leases (or individual wells) to oil and gas investors. The Company will maintain some oil and gas income, but will likely result from unsold units of oil and gas wells/leases.