EAST WEST PETROLEUM CORP SIGNS BINDING MOU WITH NIS TO DRILL 12 WELLS ON FOUR BLOCKS IN ROMANIA

Ticker: EW (TSXV)

VANCOUVER, May 24, 2011 /PRNewswire/ - East West Petroleum Corp. ("EWP" or the "Company") and Naftna Industrija Srbije j.s.c. Novi Sad ("NIS") are pleased to announce the final stage of conclusion of agreements for upstream cooperation which is to rapidly advance the development of its four Romanian onshore blocks EX-2 (Tria), EX-3 (Baile Felix), EX-7 (Periam) and EX-8 (Biled).  The joint exploration programs planned will include the collection and processing of approximately 900 km of 2D and 600 sq km of 3D seismic data with a minimum of 12 wells to be drilled on the four blocks in Romania.  The terms of the agreement are: NIS will fully fund all environmental work, 2D and 3D seismic acquisition and processing, and the drilling of 12 wells, to earn an 85% participation interest.  NIS will also refund 100% of EWP's sunk costs which total C$525,000 and EWP will retain a 15% carried interest to commercial production on all four blocks.

In an earlier agreement the Company signed Concession Agreements for four onshore exploration blocks EX-2 (Tria) EX-3 (Baile Felix), EX-7 (Periam) and EX-8 (Biled) with the Romanian National Agency of Mineral Resources.

The new petroleum licenses are located in the western region of Romania within the prolific Pannonian Basin.  The blocks have a combined area of approximately 1,000,000 acres.  The blocks, which contain multiple exploration targets, lie within a major producing region of western Romania.  The blocks have been only moderately explored, with previous exploration on the acreage generally limited to shallow structural traps.  The Company has identified a number of structural and stratigraphic leads in the deeper section and plans to focus its exploration activities on the conventional oil and gas potential in addition to unconventional shale gas potential.

EWP and NIS plan to cooperate extensively to explore for and produce oil and gas from the four concession areas.  Both conventional and unconventional resource potential has been identified on the acreage, which is situated close to numerous oil and gas fields.  The joint work programs planned will include the acquisition and processing of approximately 900 km of 2D and 600 sq km of 3D seismic data during the first two years of operations.  The new seismic data will be used to high-grade a number of prospective conventional oil and gas leads already identified on the acreage, to further study the unconventional shale potential and select drilling sites.  Under the terms of the agreement East West will retain a 15% carried interest through Phase 1 (compulsory) and Phase 2 (optional) exploration periods as well as a carried interest on any discovery through to the declaration of commerciality.  EWP will retain a 15% share of all production realized from the four concessions.

NIS is a leading explorer in this sector of the Pannonian Basin.  NIS is currently carrying out extensive E&P operation in the Vojvodina region of northern Serbia, immediately adjacent to the Romanian Periam and Biled Concessions.  NIS's operational capabilities and knowledge of regional geology are expected to contribute significantly to the success of the Romanian exploration programs.

The exploration programs are subject to final ratification of the Concession Agreements by the Government.  The farmout to NIS will be subject to further agreements and approval of NAMR, which is expected to take place soon after the Government of Romanian ratifies the Concessions.

"The cooperation agreement with East West will allow NIS to expand its presence outside Serbia and to implement NIS's strategy of becoming an active player in the Balkan energy market. Participation of NIS in the project as operator will allow us to further our experience in the region and to apply innovative technologies for developing conventional and unconventional resources," commented Kiril Kravchenko, NIS Chairman of the Management Board.

Denis Sugaipov, the COO of NIS Company said: "The deal with East West Petroleum has several operational synergies for both companies and benefits for the Romanian energy sector. NIS's geological knowledge of Pannonian basin and its success in development can be applied to an area which is analogous to the Serbian North Banat region. In addition, EWP can contribute its technical expertise in unconventional resources. I hope that this deal will show results in the near future and contribute to the development of the Romanian energy sector, enabling the sustainable development of the entire region."

David Sidoo, Chairman of East West commented, "These agreements are the culmination of many months of hard work and we are confident that in Naftna Industrija Srbije, a subsidiary of Gazprom Neft, we have sourced a key and strategic partner, with substantial operating experience and the  necessary financial and operating capabilities which can be applied to the Romanian concessions and can very quickly advance with the development of the Romanian concessions."

ABOUT EAST WEST PETROLEUM CORP:

East West Petroleum Corp. trades on the TSX Venture Exchange under the symbol EW.  East West is an emerging exploration and production company focused on conventional and unconventional petroleum resources.  Currently East West has producing assets in Egypt and Canada, and exploration and exploitation assets in India, five million acres in a joint study agreement with Kuwait Energy in Egypt, Yemen, Russia, Ukraine and one million acres in Romania.

ABOUT NAFTNA INDUSTRIJA SRBIJE J.S.C. NOVI SAD

Naftna Industrija Srbije j.s.c. Novi Sad was established in 1991 as a public company for exploration, production, refining and trade in crude oil, petroleum products and natural gas.  Since 2005, NIS has operated as a joint stock company.  In 2009, based on the international agreement between Russia and Serbia, 51% of NIS shares were acquired by the Russian company "Gazprom Neft", one of the largest and fastest growing E&P companies in Russia.  Today, NIS is one of the largest, vertically integrated oil and gas companies in Southeast Europe, dealing with exploration, production and refining of crude oil and natural gas, as well as with the sales of a broad range of petroleum products.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

SOURCE East West Petroleum Corp.

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