Chancellor Group Announces $5,000,000 Equity Financing Agreement

Funds Will Be Used to Complete Development of Kansas Oil and Gas Field, Begin

Gas Production in Texas and Start Other Projects



Apr 10, 2001, 01:00 ET from Chancellor Group

    LOS ANGELES, April 10 /PRNewswire/ -- Chancellor Group
 (OTC Bulletin Board:   CHAG) said today it had formally obtained an equity
 investment commitment for more than $5,000,000 from Barkley Finance
 Corporation.  The funding will flow to the company over  a 24-month period.
     Chancellor Group has received the first $50,000 under the commitment and
 expects to receive a further $120,000 within 30 days.  Further funding up to
 $5,000,000 will begin on completion and effectiveness of a registration
 statement, which the company expects to file with the SEC within 60 days.
 Ashraf Khan, company chairman and CEO, said the funds will enable Chancellor
 Group to complete the development of its Shinkle oil and gas property in
 Greenwood County, Kansas, drill the first production wells at its Glass
 Mountain gas project in Texas, restore its title to gas properties in
 Kentucky, and bring other projects and planned investments on-stream.
     Under the investment agreement, Barkley will subscribe for Chancellor
 Group common stock in accordance with an agreed put schedule at a discount to
 the prevailing  market price of 7.5% and with floor prices set by Chancellor
 Group.
     Khan said production of light sweet crude  oil is currently underway from
 the Shinkle B-4 well.  The company also began pumping from the B-12 well,
 although additional repair work is required and underway on the bottom hole
 pump on this well.  The A-12 well also has minor pump problems that are being
 repaired.  The company expects to be able to advise on well flow rates at the
 Shinkle field in the next day or so.
     As previously announced, the company has a formal commitment from Plains
 All American to purchase all of the crude oil production from the property at
 the prevailing well-head price plus a bonus of 50 cents a barrel owing to the
 purchaser's assessment of the quality of the crude.
 
     Chancellor Group web site: http://chancellorgroupinc.com
 
     Investor Research  (real audio):
       http://www.wallstreetnewscast.com/chag.html (real audio):
       http://www.oilandgasprofiles.com
 
     Chancellor Group Yahoo Club: http://clubs.yahoo.com/clubs/chancellorgroup
 
     Corporate profile also at http://www.thestockbroker.com
 
     Certain information included in this communication contains statements
 that are forward looking, such as statements relating to the future
 anticipated direction of the industry, plans for future expansion, various
 business development activities, planned capital expenditures, future funding
 sources, anticipated sales growth and potential contracts.  These forward
 looking statements are subject to a number of known and unknown risks and
 uncertainties that could cause actual operations or results to differ
 materially from those anticipated.
 
     For further information, contact Nelson Fitch, media relations,
 310-559-3618, for Chancellor Group; or Ashraf Khan of Chancellor Group,
 310-277-6595, ceo@chancellorgroupinc.com, or broker/investment, Tom Bustamante
 of Wall Street Newscast Inc., 212-233-9301, for Chancellor Group.
 
 

SOURCE Chancellor Group
    LOS ANGELES, April 10 /PRNewswire/ -- Chancellor Group
 (OTC Bulletin Board:   CHAG) said today it had formally obtained an equity
 investment commitment for more than $5,000,000 from Barkley Finance
 Corporation.  The funding will flow to the company over  a 24-month period.
     Chancellor Group has received the first $50,000 under the commitment and
 expects to receive a further $120,000 within 30 days.  Further funding up to
 $5,000,000 will begin on completion and effectiveness of a registration
 statement, which the company expects to file with the SEC within 60 days.
 Ashraf Khan, company chairman and CEO, said the funds will enable Chancellor
 Group to complete the development of its Shinkle oil and gas property in
 Greenwood County, Kansas, drill the first production wells at its Glass
 Mountain gas project in Texas, restore its title to gas properties in
 Kentucky, and bring other projects and planned investments on-stream.
     Under the investment agreement, Barkley will subscribe for Chancellor
 Group common stock in accordance with an agreed put schedule at a discount to
 the prevailing  market price of 7.5% and with floor prices set by Chancellor
 Group.
     Khan said production of light sweet crude  oil is currently underway from
 the Shinkle B-4 well.  The company also began pumping from the B-12 well,
 although additional repair work is required and underway on the bottom hole
 pump on this well.  The A-12 well also has minor pump problems that are being
 repaired.  The company expects to be able to advise on well flow rates at the
 Shinkle field in the next day or so.
     As previously announced, the company has a formal commitment from Plains
 All American to purchase all of the crude oil production from the property at
 the prevailing well-head price plus a bonus of 50 cents a barrel owing to the
 purchaser's assessment of the quality of the crude.
 
     Chancellor Group web site: http://chancellorgroupinc.com
 
     Investor Research  (real audio):
       http://www.wallstreetnewscast.com/chag.html (real audio):
       http://www.oilandgasprofiles.com
 
     Chancellor Group Yahoo Club: http://clubs.yahoo.com/clubs/chancellorgroup
 
     Corporate profile also at http://www.thestockbroker.com
 
     Certain information included in this communication contains statements
 that are forward looking, such as statements relating to the future
 anticipated direction of the industry, plans for future expansion, various
 business development activities, planned capital expenditures, future funding
 sources, anticipated sales growth and potential contracts.  These forward
 looking statements are subject to a number of known and unknown risks and
 uncertainties that could cause actual operations or results to differ
 materially from those anticipated.
 
     For further information, contact Nelson Fitch, media relations,
 310-559-3618, for Chancellor Group; or Ashraf Khan of Chancellor Group,
 310-277-6595, ceo@chancellorgroupinc.com, or broker/investment, Tom Bustamante
 of Wall Street Newscast Inc., 212-233-9301, for Chancellor Group.
 
 SOURCE  Chancellor Group