Hi all,

This is Part 1 of many updates and then once I got all cards on the table it will be regular updates from here on out. I basically want to give a complete overview of the whole company both past, current and future.

Saxon Oil Company:

Formerly known as Sovereign Chief Ventures (SCV.V), the company was renamed Saxon Oil Company after a merger in April 2006. The company is currently being run by Richard Green (as of Jan 2007) and IMO he has done a phenomenal job since coming on board and hes just getting started and a big reason why the company is going to be successful moving fwd.

History:

Prior to the merger in April 06, past president Bill O. Wood resigned in January 2005 and Bill D. Saxon who had served on the board since 2002 was appointed President and CEO.

Bill Saxon has deep pockets, is well connected (industry and US Government) and has been actively engaged in all aspects of the business since 1954 as an independent oil operator. In 1980 he took his private oil and gas company public and in 1985 the oil and gas reserves and all its drilling funds were rolled into a Master Limited Partnership, "Saxon Oil Development Partners L.P.", and listed on the American Stock Exchange.

Bill Saxon's tenure as President and CEO was short lived (4 months). He resigned in May 2005 but continues to pursue O&G prospects for the company as Chairman of the Board. Steven D. Saxon (his son) was appointed President of the company at that time and has significant experience in the industry from his duties as Executive VP of Saxon Oil, which was the 2nd private O&G company his family started up in 91' after his father rolled the 1st Saxon Oil company into the Limited Partnership. IMO investors were mixed about Steven taking over for his father, but Bill was in his 70's and we soon found out that the whole situation was setting up Sovereign Chief to merge with Private Saxon Oil to form the current Saxon Oil Company (SXN.V)

MAKES ME WONDER IF A 3RD PRIVATE O&G COMPANY IS IN THE WORKS AND WHY HE DECIDED TO SELL TO SOVEREIGN?

LETS TAKE A LOOK AT THE MERGER:

We issued 16,873,375 shares for 100% of "OLD" Saxon Oil

What was also in that deal was a put option/ right of 1st refusual?

Which basically says that the "OLD" Saxon Shareolders (ie Bill Saxon, his family, etc) have the right to put all or any of the 16,873,375 shares value to the "New" Company (SXN.V) for repurchase. Now this can be settled by SXN.V by issuing common shares of SXN.V with an equivalent value of the orginal purchase price or a cash payment.

So what was the orginal purchase price and its breakdown?

Cost of Acquisition: $6,048,992

• Working Capital 158,044
• Property & Equipment 7,840,544
• 10 % Investment in Preset Drilling 1,240,053
• Bank Debt (465,000)
• Note Payable (641,517)
• Future Income Tax Liabilty (2,083,132)

So at $6 million dollars for Saxon Oil we issued 16 million shares at a cost of about $0.36 for what?

Clearly, we took over some debt that SAXON had outstanding and a $2million tax liability. As for the property and equipment, looking at their production numbers as of April 06 (date of merger) we had under 100 BOE/day, so we must have paid a lot IMO for future production (which we haven't see yet from those properties) or we got a lot of equipment. We also got 10% of Preset Drilling, which I would assume is making money and perhaps once the rigs are not contracted out, we could use them? Still IMO, we paid a lot for SAXON OIL, but perhaps there is something I am missing?

What exactly does that put option mean?

In plain english, its a long-term liabilty on the Balance sheet.

So thats how we became Saxon Oil (SXN.V) and some things that needed to be mentioned to paint the clearest picture moving forward. I am not want to talk about only the good things of a company and I want to tell EVERYTHING about a company. Whether its good or bad I want to paint the clearest picture for fellow investors.

Having said all that, Rich is now the man in charge and we are a completely different company with a different direction and strategy. Moving forward I would still like to know more about the Put Option and the properties we paid over $6 million for.

Cheers,

cvac01

P.S. Part 2 is being typed and should be posted shortly