WESTLINK RESOURCES LTD, F-1/A, 2000-10-24

WESTLINK RESOURCES LTD
F-1/A, 2000-10-24
CRUDE PETROLEUM & NATURAL GAS

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<PAGE> 1

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 24, 2000

REGISTRATION NO. 333-39826

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--------------------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------------------------

AMENDMENT No. 1

FORM F-1
REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933
------------------------------------
WESTLINKS RESOURCES LTD.

(Exact name of Registrant as specified in charter)

<TABLE>
<S> <C> <C>
ALBERTA, CANADA 1311 NONE
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer Identification
incorporation or organization) Classification Code Number) No.)
</TABLE>

SUITE 700, 703 - 6TH AVENUE S.W., CALGARY, ALBERTA, CANADA T2P 0T9 TEL: (403)
261-2686

(Address, including zipcode, and telephone number, including area code,
of Registrant's principal executive offices)
------------------------------------

CARTER, LEDYARD & MILBURN, 2 WALL STREET, NEW YORK CITY, NEW YORK 10005 TEL:
(212) 732-3200
(Name, address and telephone number of agent for service)

Copies of all communications to:

<TABLE>
<S> <C> <C>
MARCIA L. JOHNSTON GERARD S. DIFIORE GARY A. AGRON
GOWLING LAFLEUR HENDERSON LLP REED SMITH LLP LAW OFFICE OF GARY A. AGRON
SUITE 1200, 700 - 2ND STREET S.W. ONE RIVERFRONT PLAZA 5445 DTC PARKWAY, SUITE 520
CALGARY, ALBERTA, CANADA T2P 4V5 NEWARK, NEW JERSEY 07102 ENGLEWOOD, COLORADO 80111
(403) 298-1000 (973) 621-3179 (303) 770-7254
</TABLE>

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: AS SOON AS
PRACTICABLE AFTER THIS REGISTRATION STATEMENT BECOMES EFFECTIVE.

If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act check
the following box: [X]

If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
---------------

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
---------------

If this Form is a post-effective amendment filed pursuant to rule 462(d) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
---------------

If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
------------------------------------

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OF 1933, OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A)
MAY DETERMINE.

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<PAGE> 2

PRELIMINARY PROSPECTUS DATED OCTOBER 24, 2000 SUBJECT TO COMPLETION

The information in this preliminary prospectus is not complete and may be
changed. We may not sell these securities until the Registration Statement filed
with the Securities and Exchange Commission is effective. This preliminary
prospectus is not an offer to sell these securities and it is not soliciting an
offer to buy these securities in any state where the offer or sale is not
permitted or in any province or territory of Canada.

WESTLINKS RESOURCES LTD.

1,000,000 SHARES OF COMMON STOCK
AND
1,000,000 COMMON STOCK PURCHASE WARRANTS

Westlinks Resources Ltd. is offering 1,000,000 shares of common stock and
1,000,000 common stock purchase warrants, to be sold in units consisting of one
share of common stock and one warrant. Each warrant allows its holder to
purchase for a period of six months from the date of this prospectus one share
of common stock for US$ -- per share. The shares and warrants will trade
separately after issuance. We anticipate that the public offering price of the
common stock will be between US$4.50 and US$5.50 for each share, and US$0.25 for
each warrant.

Our common stock is currently listed on the Canadian Venture Exchange under
the symbol "WLX", and is quoted in the National Quotation Bureau's pink sheets
under the symbol "WLKSF". The last reported sale of our common stock on the
Canadian Venture Exchange on October 17, 2000 was C$6.25 per share, and the
closing price of our common stock on the National Quotation Bureau's pink sheets
on October 13, 2000 was US$3.95 per share.

By a separate prospectus concurrent with this offering, six security
holders are offering from time to time in open market transactions up to 150,000
shares of common stock underlying warrants held by them. We will not receive any
proceeds from the sale of these shares.

INVESTING IN OUR SECURITIES INVOLVES A HIGH DEGREE OF RISK. SEE "RISK
FACTORS" BEGINNING ON PAGE 7.

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION NOR ANY PROVINCIAL SECURITIES COMMISSION IN CANADA HAS APPROVED OR
DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS PRELIMINARY PROSPECTUS IS
TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

We have granted the underwriters a 45-day option to purchase an additional
150,000 shares of common stock and 150,000 warrants at the public offering price
less the underwriting discounts, solely to cover over-allotments, if any.

<TABLE>
<CAPTION>
TOTAL WITHOUT TOTAL WITH
PER SHARE PER WARRANT OVER-ALLOTMENT OVER-ALLOTMENT
---------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Public offering price....................... US$ -- US$ 0.-- US$ -- US$ --
Underwriting discounts and commissions...... US$ -- US$ 0.-- US$ -- US$ --
Proceeds, before expenses, to Westlinks..... US$ -- US$ 0.-- US$ -- US$ --
</TABLE>

The underwriters are offering the shares of common stock and warrants on a
firm commitment basis and expect to deliver the securities against payment in
Westport, Connecticut within three business days from the date of this
prospectus.

PRIMA TERRA CAPITAL SPENCER EDWARDS, INC.

DIVISION OF MERIT CAPITAL ASSOCIATES, INC.

Prospectus dated -- , 2000
<PAGE> 3

TABLE OF CONTENTS

<TABLE>
<S> <C>
Cautionary Statement Concerning Forward-Looking
Statements................................................ 2
Exchange Rate Information................................... 2
Enforceability of Civil Liabilities against Foreign
Persons................................................... 3
Prospectus Summary.......................................... 4
Risk Factors................................................ 7
Dilution.................................................... 10
Use of Proceeds............................................. 11
Price Range of Common Stock................................. 12
Dividend Policy............................................. 12
Capitalization.............................................. 13
Selected Financial Data..................................... 14
Management's Discussion and Analysis of Financial Condition
and Results of Operations................................. 15
Business.................................................... 22
Management.................................................. 33
Executive Compensation...................................... 35
Interest of Management and Others in Certain Transactions... 38
Principal Stockholders...................................... 40
Description of Securities................................... 41
Shares Eligible for Future Sale............................. 42
Legal Proceedings........................................... 43
Underwriting................................................ 43
Effect of Canadian Tax Laws on United States Stockholders... 45
Legal Matters............................................... 46
Experts..................................................... 46
Where You Can Find Additional Information................... 46
Index to Consolidated Financial Statements.................. F-1
</TABLE>

<PAGE> 4

CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

We have made forward-looking statements in this prospectus that are subject
to risks and uncertainties. Forward-looking statements include information in
this document regarding:

<TABLE>
<S> <C>
- capital spending - efficiencies
- oil and natural gas production - cost savings
- oil and natural gas reserves - future earnings
</TABLE>

The sections of this prospectus which contain forward-looking statements
include:

- "Prospectus Summary"

- "Risk Factors"

- "Management's Discussion and Analysis of Financial Condition and Results
of Operations"

- "Business"

Our forward-looking statements are also identified generally by the use of
the future tense and by words such as "believes", "expects", "anticipates",
"intends", "estimates" or similar expressions. Statements and calculations
concerning oil and gas reserves and their present value also may be deemed to be
forward-looking statements in that they reflect the determination, based on
estimates and assumptions, that oil and gas resources may be profitably
exploited in the future.

All of these statements are based on our current expectations and on a
number of assumptions. They are subject to risks and uncertainties discussed in
detail elsewhere in this prospectus. Actual results could vary materially from
those anticipated.

For all these statements, we claim the protection of the safe harbor for
forward-looking statements contained in the Private Securities Litigation Reform
Act of 1995, as amended.

EXCHANGE RATE INFORMATION

We publish our consolidated financial statements in Canadian dollars. In
this prospectus, except where otherwise indicated, all dollar amounts are stated
in Canadian dollars. References to "$" or "C$" are to Canadian dollars and
references to "US$" are to U.S. dollars. The following table sets forth for each
period indicated the period end exchange rates for conversion of U.S. dollars to
Canadian dollars, the average exchange rates on the last day of each month
during such period and the high and low exchange rates during such period. These
rates are based on the noon buying rate in New York City, expressed in U.S.
dollars, for cable transfers in Canadian dollars as certified for customs
purposes by the Federal Reserve Bank of New York.

EXCHANGE RATES FOR U.S. DOLLARS: C$1.00 =

<TABLE>
<CAPTION>
SIX MONTHS YEAR ENDED
ENDED JUNE 30, DECEMBER 31,
---------------- --------------------------
2000 1999 1999 1998 1997
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
End of the period........................... 0.6758 0.6787 0.6918 0.6538 0.6996
Average for the period(1)................... 0.6806 0.6718 0.6691 0.6693 0.7207
High during the period...................... 0.6968 0.6891 0.6935 0.7124 0.7497
Low during the period....................... 0.6629 0.6535 0.6464 0.6311 0.6938
</TABLE>

---------------

(1) The average for the period is the average of the conversion rates on the
last day of each month in the period.

2
<PAGE> 5

On October 18, 2000 the noon buying rate in New York City for cable
transfers of Canadian dollars as certified for customs purposes by the Federal
Reserve Bank of New York, was C$1.00 = US$0.6579. Except as otherwise indicated,
this rate is used for conversion purposes in this prospectus.

ENFORCEABILITY OF CIVIL LIABILITIES AGAINST FOREIGN PERSONS

We are a corporation organized under the laws of the Province of Alberta,
in Canada, all of our directors and officers, as well as the experts named in
this prospectus, reside in Canada and all of our assets and most of the assets
of these persons are located outside the United States. As a result, it may not
be possible for you to effect service of process within the United States upon
us or those persons, or to enforce against us or them in the United States
judgments obtained in U.S. courts based upon the civil liability provisions of
the U.S. federal securities laws or other laws of the United States. We have
been advised by Gowling Lafleur Henderson LLP, our Canadian counsel, that there
is doubt as to the enforceability in Canada of the civil liability provisions of
U.S. federal securities laws, or of judgments of U.S. courts predicated solely
upon U.S. federal securities laws.

3
<PAGE> 6

PROSPECTUS SUMMARY

To understand this offering fully, you should carefully read the entire
prospectus, including the risk factors and the consolidated financial
statements. This summary highlights selected information set out elsewhere in
this prospectus.

BUSINESS

Westlinks Resources Ltd. is engaged in the drilling and operation of oil
and gas wells in western Canada, primarily in the province of Alberta. We have
assembled an experienced management team which includes executive officers with
oil and gas exploration experience, as well as experience in property
acquisitions, petroleum engineering, oil and gas drilling operations, debt and
equity financings and financial accounting.

STRATEGY

Our management team has developed what we consider to be a highly focused
approach to the exploitation and development of oil and gas properties. This
approach includes the following elements:

- the concentration on low-risk, development prospects that offer higher
probabilities of success, often among multiple oil and gas zones;

- the consolidation of adjacent or close-proximity prospects in order to
reduce drilling and operating costs;

- the acquisition of oil and gas producing properties at prices which we
believe are recoverable within a reasonable time frame;

- the emphasis on development drilling in our currently producing core
areas in order to minimize drilling risk;

- the use of either seismic analysis, including three dimensional seismic,
when it is cost effective, or information from adjacent wells, to
further minimize drilling risk; and

- the selection of producing oil and gas properties we can operate and
which we believe offer us the opportunity to reduce operating costs and
maximize economies of scale, thereby improving operating profitability.

OPPORTUNITY

The consolidation of the oil and gas industry in Canada has resulted in the
emergence of larger companies which are being forced to explore and develop
larger prospects in order to support their growth. We believe that this
consolidation offers smaller oil and gas companies the opportunity to
economically purchase producing properties which do not meet the economic
requirements of larger companies. We further believe that we can leverage our
management team's experience and the economies of scale generated from
consolidating adjacent properties in our core areas, to improve our
profitability.

ACQUISITION HISTORY

In the two years since our amalgamation, we have grown significantly
through a series of asset acquisitions. We have made four acquisitions of oil
and gas assets in our current four core areas in Alberta, acquiring our Bigoray
area assets and our Sylvan Lake area assets in August, 1999, our Mitsue area
assets in February, 2000 and our Sounding Lake area assets in May, 2000.

As of September 30, 2000, we had working interests in 56 oil wells (39.7
net), producing approximately 1,440 barrels of oil equivalent per day, and held
oil and gas leases on net acreage of approximately 21,000 acres, in the four
core areas in which we are the operator plus a portion of the Sounding Lake,
Alberta area in which we are not the operator.

4
<PAGE> 7

We have entered into an agreement to sell all of our oil and gas assets in
the Bigoray area of Alberta, except natural gas in the Belly River formation,
for $4,583,500. After this sale, we will have working interests in 51 oil wells
(35.3 net), which will produce approximately 1,240 barrels of oil equivalent per
day, and will hold oil and gas leases on net acreage of approximately 19,350
acres.

Our executive offices are located at Suite 700, 703 - 6th Avenue S.W.,
Calgary, Alberta, Canada T2P 0T9, our telephone number is (403) 261-2686 and our
fax number is (403) 261-2704. Our email address for general information and
correspondence is [email protected] and our Web site address is
www.westlinks-resources.com. Information contained on our Web site does not
constitute part of this prospectus.

THE OFFERING

Except where noted otherwise, all information in this prospectus, including
share and per share information, assumes an offering price of US$5.00 per share
and US$0.25 per warrant, and no exercise of the underwriters' over-allotment
option.

SECURITIES OFFERED: 1,000,000 shares of common stock and 1,000,000
warrants. The securities are offered in units
consisting of one share and one warrant. The common
stock and the warrants will trade separately
immediately after the offering.

WARRANT ATTRIBUTES: Each warrant entitles the holder to purchase one
share of common stock for US$ -- until
-- , 2001.

COMMON STOCK TO BE
OUTSTANDING AFTER THE
OFFERING: 5,582,639 shares.

USE OF PROCEEDS: We estimate that we will receive net proceeds of
about US$4,295,000. We expect to use the net
proceeds for repayment of debt; for acquisitions
and/or development of additional reserves, and for
working capital.

PROPOSED NASDAQ SMALLCAP
MARKET SYMBOLS: Common stock: WLKS; Warrants: WLKSW

CANADIAN VENTURE EXCHANGE
SYMBOL: Common stock: WLX

PINK SHEET SYMBOL: Common stock: WLKSF

In addition to the common stock outstanding after the offering, we may
issue up to 1,000,000 shares of common stock on exercise of the warrants offered
hereby and up to 643,000 shares of common stock on exercise of currently
outstanding options and warrants to be issued to the underwriters.

Concurrent with this offering, security holders who are not officers or
directors are offering to sell up to 150,000 shares of our common stock which
were issued upon the exercise of warrants on October 2, 2000. We will not
receive any proceeds from the sale of these shares, but we received the exercise
price upon the exercise of the warrants. Each such warrant was exercised to
purchase one share of common stock at US$4.00 per share. These warrants were
issued in connection with a loan of US$1,550,000 made to Westlinks in connection
with our Sounding Lake acquisition.

5
<PAGE> 8

SUMMARY CONSOLIDATED FINANCIAL DATA

The following table presents a summary of our consolidated statement of
operations derived from our financial statements, adjusted to conform with U.S.
GAAP. The data should be read with "Management's Discussion and Analysis of
Financial Condition and Results of Operations" and our financial statements and
notes included elsewhere in this prospectus. The monetary amounts in the table
are expressed in Canadian dollars, except for two columns which show the U.S.
dollar equivalency for the periods ended June 30, 2000 and December 31, 1999.
The U.S. dollar equivalent amounts are calculated on the basis of C$1.00 equals
US$0.6579.

CONSOLIDATED STATEMENTS OF OPERATIONS DATA:

<TABLE>
<CAPTION>
UNAUDITED
SIX MONTHS ENDED JUNE 30, YEAR ENDED DECEMBER 31,
------------------------------ -----------------------------------------
2000 2000 1999 1999 1999 1998 1997
-------- ------- ------- -------- ------- ------- -------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
Net revenue.......................... US$3,263 C$4,959 C$ 737 US$1,365 C$2,075 C$1,697 C$1,055
Gross profit......................... 2,393 3,638 415 850 1,292 848 617
Operating expenses................... 869 1,321 322 514 782 849 439
Exploration expenses................. -- -- -- 2 3 4 35
General and administrative
expenses........................... 341 518 227 473 719 427 176
Interest............................. 151 230 41 87 132 185 74
Depreciation and depletion........... 906 1,377 289 554 842 805 352
Gain (loss) from operations.......... 995 1,513 (289) (361) (548) (572) (21)
Net income (loss).................... US$ 934 C$1,420 C$ (133) US$ (85) C$ (129) C$ 311 C$ 193
======== ======= ======= ======== ======= ======= =======
Net income (loss) per share.......... US$ 0.22 C$ 0.33 C$(0.05) US$(0.03) C$(0.04) C$ 0.13 C$ 0.14
======== ======= ======= ======== ======= ======= =======
</TABLE>

The following table indicates a summary of our consolidated balance sheets
as of December 31, 1998 and 1999 and June 30, 2000. The "As Adjusted" column
below reflects our receipt of estimated net proceeds of US$4,295,000 from the
sale of 1,000,000 shares and warrants at an assumed public offering price of
US$5.25, after deducting underwriting discounts and estimated expenses of
US$955,000, converted to C$1,451,600 on the basis of C$1.00 = US$0.6579. The
monetary amounts in the table are expressed in Canadian dollars, except for the
column showing the U.S. dollar equivalency as of June 30, 2000. The U.S. dollar
equivalent amounts are calculated on the basis of C$1.00 equals US$0.6579.

CONSOLIDATED BALANCE SHEET DATA:

<TABLE>
<CAPTION>
DECEMBER 31,
UNAUDITED -----------------
JUNE 30, 2000 1999 1998
--------------------------------------- ------- -------
ACTUAL ACTUAL AS ADJUSTED(1) ACTUAL ACTUAL
--------- -------- -------------- ------- -------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
Cash and short term investments... US$ 1 C$ 2 C$ 4,575 C$ 42 74
Accounts receivable............... 905 1,375 1,375 685 231
Capital assets.................... 13,416 20,393 20,393 7,017 3,622
Total assets...................... 15,087 22,932 27,224 7,744 4,288
Total stockholders' equity........ 3,808 5,788 10,079 3,978 2,852
</TABLE>

---------------

Note:

(1) The "As Adjusted" column reflects the payment of the notes payable in the
amount of $2,237,100 subsequent to June 30, 2000. The "As Adjusted" column
does not reflect the exercise of 150,000 warrants for 150,000 shares on
October 2, 2000.

6
<PAGE> 9

RISK FACTORS

WESTLINKS HAD A LARGE WORKING CAPITAL DEFICIENCY AT JUNE 30, 2000; OUR CREDIT
FACILITIES CAN BE CALLED AT ANY TIME.

At June 30, 2000, we had a working capital deficiency of C$2,550,878, which
means our current liabilities exceeded our current assets by that amount. We
require the proceeds of this offering to fund most of our year 2000 drilling
budget. Using the principles of U.S. GAAP, all of our long-term debt would be
classified as a current liability resulting in a working capital deficiency of
C$14,340,878. Our credit facilities are all on a demand basis and could be
called for repayment at any time.

OUR ASSETS ARE HIGHLY LEVERAGED.

In order to complete our recent acquisition in the Sounding Lake, Alberta
area, we incurred a high amount of debt relative to our assets. A decrease in
the amount of our production or the price we receive for it could make it
difficult for us to service our loan or may cause the bank that issued our loan
to determine that our assets are insufficient security for our bank debt.

THERE IS UNCERTAINTY ABOUT ESTIMATES USED IN THIS PROSPECTUS AND THEY MAY PROVE
TO BE INACCURATE, RESULTING IN A REDUCTION OF OUR WORKING CAPITAL.

This prospectus contains estimates of future net cash flows from our oil
and gas reserves, prepared by independent engineers, which are based upon the
estimates of oil and gas reserves in the ground and the percentage of those
reserves which can be recovered and produced with current technology. These
estimates include assumptions as to the prices received for the sale of oil and
gas. Any one or all of those estimates may be inaccurate, which could materially
effect our estimate of future net cash flows. In addition, the cost of capital
and operating expenses could be higher than estimated, resulting in a reduction
in working capital and the need to raise additional capital.

WESTLINKS' OPERATIONS ARE SUBJECT TO MANY HAZARDS.

Our oil and natural gas operations are subject to all of the risks relating
to drilling for and producing oil and natural gas. These include explosions,
fires and equipment failures. Such events can result in personal injuries, loss
of life, environmental damage and financial loss. Although we try to hire
experienced drilling contractors to drill and equip our wells, many of the crews
being used are inexperienced and accidents may occur. Claims could be made
against us in the event any accidents occur. All of our assets and revenue may
not be adequate to cover the amount of any valid claims made.

IF WE CANNOT ACQUIRE OIL AND GAS RESERVES AT A REASONABLE COST, WESTLINKS WILL
CEASE TO OPERATE.

We need to increase our oil and gas reserves and sell them at profitable
rates to stay in business. The costs to drill and equip wells increases as
overall drilling activity increases. This is expected to occur over the next
twelve months. We do not always pick successful locations to drill which results
in non-producing wells. Our ability to purchase oil and gas reserves at a
reasonable price may not continue as competition increases or our financial
resources decline.

THE VALUE OF OUR ASSETS WILL VARY, PERHAPS SIGNIFICANTLY, BECAUSE OF WORLD OIL
AND GAS MARKETS AND OTHER FACTORS WE CANNOT CONTROL.

Although we try to control the costs we incur in our operations, we cannot
control the prices we receive for our oil and gas assets. These values fluctuate
with changes in world oil prices, which reflect global supply and demand
pressures. A change in political conditions, government regulation and even
weather conditions can influence prices. Alternative fuel sources may be
developed and sold at competitive prices. A decrease in the value of our assets
will impact the amount of money which our lenders will provide to us.

7
<PAGE> 10

WE MAY BE SUBJECT TO ENVIRONMENTAL LIABILITY CLAIMS THAT COULD RESULT IN
SIGNIFICANT COSTS TO US.

We may be subject to claims for damages related to any impact which our
operations have on the environment. An environmental claim could materially
adversely affect our business because of the costs of defending against these
types of lawsuits, the impact on senior management's time and the potential
damage to our reputation. Our oil and gas operations are subject to government
regulations and control. Failure to comply with applicable government rules
could restrict Westlinks' ability to engage in further oil and gas exploration
and development opportunities.

OUR INSURANCE MAY BE INADEQUATE FOR ALL BUSINESS RISKS, CAUSING US UNANTICIPATED
LOSSES.

Westlinks' insurance may be inadequate. We do not insure fully against all
business risks because either the insurance is not available or the premiums are
prohibitively expensive. We believe that we carry the amount of insurance
standard in the Canadian oil and gas industry. However, a loss not fully covered
by insurance could have a materially adverse effect on our financial position
and results of operations.

OUR REVENUE IS SUBJECT TO VOLATILE OIL AND GAS PRICES WHICH COULD REDUCE OUR
REVENUE AND PROFITABILITY.

The price Westlinks receives for its oil and gas production is subject to
significant volatility. Our revenue, cash flow and profitability are
substantially dependent on prevailing prices for oil and gas. Historically oil
and gas prices and markets have been volatile and they are likely to continue to
be volatile in the future. Some factors which contribute to volatility include:

- political conditions in the Middle East, the former Soviet Union and
other regions;

- domestic and foreign supplies of oil and gas;

- the level of consumer demand;

- weather conditions;

- domestic and foreign government regulations;

- the availability and prices of alternative fuels; and

- overall economic conditions.

AS A CANADIAN OIL AND GAS COMPANY, WE MAY BE ADVERSELY AFFECTED BY CHANGES IN
THE EXCHANGE RATE BETWEEN U.S. AND CANADIAN DOLLARS.

The price Westlinks receives for its oil and gas production is expressed in
U.S. dollars, which is the standard for the oil and gas industry world-wide.
However, Westlinks pays its operating expenses, drilling expenses and general
overhead expenses in Canadian dollars. Changes to the exchange rate between U.S.
and Canadian dollars can adversely affect us. When the value of the U.S. dollar
increases, we receive higher revenue and when the value of the U.S. dollar
declines, we receive lower revenue on the same amount of production sold at the
same prices.

WESTLINKS DEPENDS ON ITS KEY PERSONNEL FOR CRITICAL MANAGEMENT DECISIONS AND
INDUSTRY CONTACTS BUT HAS NO EMPLOYMENT CONTRACTS NOR KEY PERSON INSURANCE.

We are dependent upon the continued services of our management team. We do
not have employment contracts with any of these executives, except for a
consulting contract with Thomas. J. Jacobsen which terminates April 15, 2001,
and do not carry key person insurance on their lives. The loss of the services
of our executive officers, through incapacity or otherwise, could have a
material adverse effect on our business and would require us to seek and retain
other qualified personnel.

8
<PAGE> 11

WESTLINKS HAS NOT PAID DIVIDENDS, DOES NOT INTEND TO PAY DIVIDENDS IN THE
FORESEEABLE FUTURE AND IS CURRENTLY RESTRICTED FROM PAYING DIVIDENDS PURSUANT TO
THE TERMS OF ITS CREDIT FACILITY AND ALBERTA CORPORATE LAW.

We have not paid any cash dividends on our common stock and do not expect
to pay any cash or other dividends in the foreseeable future. The terms of our
current banking credit facility prohibit us from declaring and paying dividends
except from assets which are in excess of the required amount of security under
our credit facility, and Alberta corporate law prohibits the payment of
dividends unless stated solvency tests are met.

INVESTORS IN THIS OFFERING WILL EXPERIENCE DILUTION IN THE BOOK VALUE OF SHARES
PURCHASED.

At June 30, 2000, our unaudited net tangible book value was C$5,654,789, or
C$1.28 (US$0.84) per share. After giving effect to our sale of 1,000,000 shares
of common stock, based on an assumed offering price of US$5.00 per share and
1,000,000 warrants based on an offering price of US$0.25 per warrant, our
adjusted net tangible book value at June 30, 2000 would have been C$2.24
(US$1.47) per share, resulting in dilution of C$5.74 (US$3.78) per share or 72%
to investors in the offering. Moreover, current shareholders purchased their
shares at prices per share below the price of the shares being offered.

A LARGE NUMBER OF OUR SHARES OF COMMON STOCK ARE ELIGIBLE FOR FUTURE SALE WHICH
COULD LOWER OUR MARKET PRICE.

Sales of our common stock after the offering, or even the potential for
these sales, could lower the market price of our common stock. In addition,
these sales may negatively affect our ability to raise needed capital through
the sale of common stock. We have 4,582,639 shares of common stock outstanding,
of which 4,050,639 are freely tradeable. Of these 4,050,639 freely tradeable
shares, 2,005,280 shares are held by Westlinks' officers and directors, who are
subject to a 180 day lock-up agreement with Westlinks and the underwriters with
respect to 1,537,280 of such shares. Because many of these shares are held in
street name rather than certificated form, it is more difficult to provide a
mechanism that will assure the lock-up agreements are honored. The balance of
532,000 shares may be resold immediately if Canadian regulations are met and
will become freely tradeable in the United States and Canada at various dates
which commence on October 20, 2000.

OUR STOCK IS THINLY TRADED AND IS SUBJECT TO PRICE VOLATILITY.

Trading volume in our common stock has historically been limited.
Accordingly, the trading price of our common stock could be subject to wide
fluctuations in response to quarterly variations in operating results, changes
in financial estimates by securities analysts, an imbalance of purchasers and
sellers, or other factors.

9
<PAGE> 12

DILUTION

At June 30, 2000, our unaudited net tangible book value was C$5,654,789, or
$1.28 per share (US$0.84 per share). Net tangible book value per share
represents our net tangible assets less liabilities divided by the number of
outstanding shares of common stock.

After giving effect to our sale of 1,000,000 shares of common stock and
1,000,000 warrants and our receipt of an estimated C$6,528,400 (US$4,295,000) of
net proceeds from the offering, based on an assumed offering price of US$5.25
per unit, adjusted net tangible book value at June 30, 2000 would have been
C$2.24 (US$1.47) per share. This amount represents an immediate increase in net
tangible book value of C$0.96 (US$0.63) per share to existing stockholders and
an immediate dilution of C$5.74 (US$3.78) or 71% of the per share offering price
of common stock to new investors purchasing shares in the offering. The
following table, expressed in Canadian dollars, illustrates per share dilution:

<TABLE>
<S> <C> <C>
Assumed public offering price (US$5.25)..................... C$7.98
Net tangible book value prior to the offering.......... C$1.28
Increase attributable to new investors................. C$0.96
------
Adjusted net tangible book value after the offering......... C$2.24
------
Dilution per share to new investors in this offering........ C$5.74
======
</TABLE>

On the basis of C$1.00 = US$0.6579, the dilution per share to new investors
in this offering is US$3.78.

The following table sets forth as of June 30, 2000, the number of shares of
common stock purchased from Westlinks, the total consideration paid to Westlinks
and the average price per share paid to Westlinks, expressed in Canadian
dollars, by the past and present officers and directors and promoters and
affiliated persons, and new investors purchasing securities in this offering,
before deducting underwriting discounts and estimated offering expenses:

<TABLE>
<CAPTION>
SHARES PURCHASED TOTAL CONSIDERATION
-------------------- ---------------------- AVERAGE PRICE
NUMBER PERCENT AMOUNT PERCENT PER SHARE
--------- ------- ----------- ------- -------------
<S> <C> <C> <C> <C> <C>
Officers, directors, and affiliated
persons.......................... 2,330,436(1) 51% $ 2,131,564 16% $0.915
New Investors...................... 1,000,000 22% 7,980,000(2) 61% $7.98 (2)
--------- ---- -----------
Total.............................. 3,330,436 73% $10,111,564 77%
</TABLE>

---------------
Notes:

(1) This number is not necessarily the same as the number currently held by the
directors, officers and their affiliates, because it includes shares
purchased by former officers and directors, and consists only of shares
purchased directly from Westlinks, some of which may have subsequently been
resold.

(2) US$5,250,000, being US$5.00 per share of common stock and US$0.25 per
warrant, converted on the basis of C$1.00 = US$0.6579.

The above table excludes shares issuable upon exercise of outstanding
options and warrants, the underwriters' warrants and the underwriters'
over-allotment option. To the extent that currently outstanding options or
warrants are exercised at prices below US$5.00, there will be further dilution
to new investors.

10
<PAGE> 13

USE OF PROCEEDS

The net proceeds from the sale of the 1,000,000 shares and 1,000,000
warrants sold in this offering will be approximately US$4,295,000 after payment
of the underwriters' discounts and commissions, and the estimated costs of the
offering. In Canadian dollars, we expect the net proceeds to be approximately
$6,528,400.

We intend to use the net proceeds over the next twelve months approximately
as indicated in the following table, which is expressed in Canadian dollars:

<TABLE>
<CAPTION>
APPLICATION AMOUNT %
----------- ---------- ---
<S> <C> <C>
Acquisitions and/or development of additional reserves...... 3,552,780 54
Working capital............................................. 2,975,620 46
---------- ---
$6,528,400 100
========== ===
</TABLE>

If all of the warrants are exercised, the additional proceeds of $7,980,000
(US$5,250,000) will be used for general corporate purposes, including working
capital. If the over-allotment option is exercised in full, the additional
proceeds of $1,041,390 (US$685,125) from the sale of shares and $1,197,000
(US$787,500) from the exercise of the warrants will be used for general
corporate purposes, including working capital.

We have allocated $3,552,780 for acquisitions and/or the development of
additional reserves. Our present intention is to use these monies to fund part
of our planned 2000 capital expenditure program of $5.9 million. This program
includes the costs of drilling, completing and equipping up to nine wells. No
property acquisitions have been planned or identified by us. However, we
continually assess property purchase opportunities and may use these proceeds to
fund acquisitions in favourable circumstances.

The description above represents our best estimate of the uses of the net
proceeds to be received in this offering, based on current planning and business
conditions. The precise allocation of funds among these uses will depend on:

- the amount of cash generated by our operations;

- the success of our drilling program; and

- the emergence of future opportunities.

We believe that our existing revenue, capital resources and the net
proceeds of this offering will be sufficient to maintain our current and planned
operations for a period of at least 12 months from the date of this prospectus.

11
<PAGE> 14

PRICE RANGE OF COMMON STOCK

Our shares of common stock trade on the Canadian Venture Exchange under the
symbol "WLX". The following table sets forth the high, low and closing sale
prices, in Canadian dollars, and volume of trading of our common stock, as
reported by the Exchange, for the periods shown.

<TABLE>
<CAPTION>
PERIOD HIGH LOW CLOSE VOLUME
------ ---- ---- ----- -------
$ $ $ #
<S> <C> <C> <C> <C>
1998
Quarter ended September 30.................................. 0.50 0.26 0.42 48,600
Quarter ended December 31................................... 0.65 0.21 0.64 207,700
1999
Quarter ended March 31...................................... 1.50 0.50 1.45 587,800
Quarter ended June 30....................................... 1.70 0.70 0.41 209,100
Quarter ended September 30.................................. 1.18 0.41 1.00 232,800
Quarter ended December 31................................... 1.05 0.58 0.67 122,900
2000
Quarter ended March 31...................................... 4.50 4.45 4.60 729,180
Quarter ended June 30....................................... 7.05 4.45 7.05 600,600
Quarter ended September 30.................................. 7.50 6.50 6.90 279,994
October 1 through 17........................................ 6.90 5.50 6.25 37,030
</TABLE>

Our shares of common stock have traded on the National Quotation Bureau's
pink sheets under the symbol "WLKSF" since April 26, 2000. The following table
sets forth the bid prices, in U.S. dollars, as reported on the pink sheets, for
the periods shown.

<TABLE>
<CAPTION>
PERIOD HIGH LOW CLOSE
------ ------- ------- -------
<S> <C> <C> <C>
Quarter ended June 30, 2000................................. US$4.79 US$3.41 US$4.79
Quarter ended September 30, 2000............................ US$5.10 US$3.50 US$4.57
October 1 through 13, 2000.................................. US$4.61 US$3.81 US$3.95
</TABLE>

Such over-the-counter market quotations reflect inter-dealer prices,
without retail mark-up, mark-down or commissions and may not necessarily
represent actual transactions.

At October 18, 2000, there were 4,582,639 issued and outstanding shares of
common stock held of record by 74 stockholders. Of these stockholders, 23
registered shareholders have addresses in the United States and hold 1,180,057
shares of common stock (representing 26% of our issued and outstanding shares).

DIVIDEND POLICY

We plan to retain all of our earnings, if any, to finance the expansion of
our business and for general corporate purposes. We have not paid any cash
dividends on our common stock and do not expect to declare to pay any cash or
other dividends in the foreseeable future. In addition, the terms of our current
banking credit facility prohibits us from declaring and paying dividends except
from assets which are in excess of the required amount of security, and Alberta
corporate law prohibits the payment of dividends unless stated solvency tests
are met.

12
<PAGE> 15

CAPITALIZATION

The following table sets forth Westlinks' consolidated capitalization at
June 30, 2000 and as adjusted to give effect to the sale of 1,000,000 shares of
common stock and 1,000,000 warrants in this offering. All monetary amounts are
in Canadian dollars.

<TABLE>
<CAPTION>
OUTSTANDING AT AS ADJUSTED AS ADJUSTED AT
JUNE 30, 2000 FOR PAYMENT JUNE 30, 2000
(1)(2) OF NOTES PAYABLE(6) (1)(2)(3)(4)
-------------- ------------------- ---------------
<S> <C> <C> <C>
Notes payable............................... $ 2,237,100 $(2,237,100) --
Long-term debt(5)........................... 11,790,000 -- $11,790,000
----------- ----------- -----------
14,027,100 $(2,237,100) 11,790,000
----------- ----------- -----------
Common stock................................ 3,902,830 -- 10,431,230
Contributed surplus......................... 150,500 -- 150,500
Retained earnings........................... 1,601,459 -- 1,601,459
----------- ----------- -----------
Total shareholders' equity................ 5,654,789 -- 12,183,189
----------- ----------- -----------
Total capitalization........................ $19,681,889 $(2,237,100) $23,973,189
=========== =========== ===========
</TABLE>

---------------

(1) The Company has authorized an unlimited number of common voting shares. At
June 30, 2000, there were 4,432,639 shares issued and outstanding and after
giving effect to this offering of 1,000,000 shares, 5,432,639 shares would
be issued and outstanding.

(2) At June 30, 2000, a total of 443,000 shares of common stock were reserved
for issuance pursuant to outstanding director and employee stock options, of
which 53,000 are exercisable at $2.00 per share and 390,000 are exercisable
at $6.15 per share, and a total of 150,000 shares of common stock are
reserved for issuance pursuant to 150,000 common stock purchase warrants,
which are exercisable at US$4.00 per share. The 150,000 warrants were
exercised on October 2, 2000.

(3) Up to 1,000,000 shares of common stock are reserved for issuance pursuant to
common stock purchase warrants to be issued pursuant to this offering,
exercisable at US$ -- per share, and 100,000 underwriters' warrants are
exercisable at US$ -- per share.

(4) Net of expenses from the issuance of the shares of common stock and
warrants, estimated to be $1,451,600 (US$955,000).

(5) In May, 2000, Westlinks negotiated a new revolving credit facility for $12.5
million which requires monthly interest payments, subject to the bank's
right of demand. The loan bears interest at the bank's prime rate plus 0.25%
per annum. The loan is secured by a floating charge debenture in the amount
of $25,000,000 over all assets.

(6) On October 2, 2000, the notes payable in the amount of $2,237,100 were
repaid. The "As Adjusted" column does not reflect the exercise of 150,000
warrants for 150,000 shares on October 2, 2000.

13
<PAGE> 16

SELECTED FINANCIAL DATA

The following tables present selected historical financial data for
Westlinks derived from our financial statements which have been adjusted to
conform with U.S. GAAP. The data should be read with "Management's Discussion
and Analysis of Financial Condition and Results of Operations" and our financial
statements and notes included elsewhere in this prospectus. All monetary amounts
are expressed in Canadian dollars. On October 18, 2000 the exchange rate, being
the noon buying rate in New York City for cable transfers of Canadian dollars as
certified for customs purposes by the Federal Reserve Bank of New York, was
C$1.00 = US$0.6579.

CONSOLIDATED STATEMENTS OF OPERATIONS DATA:

<TABLE>
<CAPTION>
UNAUDITED
SIX MONTHS ENDED YEAR ENDED
JUNE 30, DECEMBER 31,
---------------- --------------------------
2000 1999 1999 1998 1997
------ ------ ------ ------ ------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C>
Net revenue................................... $4,959 $ 737 $2,075 $1,697 $1,055
Gross profit.................................. 3,638 415 1,292 848 617
Operating expenses............................ 1,321 322 782 849 438
Exploration expenses.......................... -- -- 3 4 35
General and administrative expenses........... 518 227 719 427 176
Interest...................................... 230 41 132 185 74
Depreciation and depletion.................... 1,377 289 842 805 352
Gain (loss) from operations................... 1,513 (289) (548) (572) (21)
Net income (loss)............................. $1,420 $ (133) $ (129) $ 311 $ 193
====== ====== ====== ====== ======
Net income (loss) per share................... $ 0.33 $(0.05) $(0.04) $ 0.13 $ 0.14
====== ====== ====== ====== ======
</TABLE>

The following table presents selected historical financial data from our
balance sheets as of December 31, 1999 and 1998 and June 30, 2000. The column
labelled "As Adjusted" reflects our receipt of estimated net proceeds from the
sale of 1,000,000 shares of common stock and 1,000,000 warrants at an assumed
public offering price of US$5.00 per share and US$0.25 per warrant (converted to
C$7.98 on the basis of C$1.00 = US$0.6579), after deducting underwriting
discounts, commissions and estimated expenses. See the "Pro-Forma Consolidated
Balance Sheet" commencing at page F-26 herein.

CONSOLIDATED BALANCE SHEET DATA:

<TABLE>
<CAPTION>
UNAUDITED
JUNE 30, 2000 DECEMBER 31,
------------------------- -----------------
ACTUAL AS ADJUSTED(1) 1998 1999
------- -------------- ------ -------
(IN THOUSANDS)
<S> <C> <C> <C> <C>
Cash and short term investments................. $ 2 $4,575 $ 42 $ 74
Accounts receivable............................. 1,375 1,375 685 231
Capital assets.................................. 20,393 20,393 7,017 3,622
Total assets.................................... 22,932 27,224 7,744 4,288
Total stockholders' equity...................... 5,788 10,079 3,978 2,852
</TABLE>

---------------

Note:

(1)The "As Adjusted" column reflects the payment of the notes payable in the
amount of $2,237,100 subsequent to June 30, 2000. The "As Adjusted" column
does not reflect the exercise of 150,000 warrants for 150,000 shares on
October 2, 2000.

14
<PAGE> 17

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS

The following discussion is to inform you about our financial condition,
liquidity and capital resources as of June 30, 2000, June 30, 1999, December 31,
1999 and December 31, 1998 and the results of operations for the six months
ended June 30, 2000 and June 30, 1999 and for the years ended December 31, 1999
and 1998 and for the period from commencement of operations, April 1, 1997,
through December 31, 1997. THE INFORMATION IS EXPRESSED IN CANADIAN DOLLARS.

SIX MONTHS ENDED JUNE 30, 2000 COMPARED TO SIX MONTHS ENDED JUNE 30, 1999

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

At June 30, 2000 Westlinks' working capital was a deficit of $2,550,878.
Under U.S. GAAP the deficit would be $14,340,878 due to the reclassification of
the long-term debt to current liabilities. At June 30, 2000 Westlinks had a
revolving production loan with a Canadian bank. The production loan only
requires the payment of interest and is reviewed annually to ensure Westlinks'
reserves are sufficient to support the loan. Under Canadian GAAP, because there
is no required reduction of the loan, the loan is classified as long term.

Cash flows provided from operating activities were $2,890,674 for the first
six months of 2000 compared to $713 in the first six months of 1999. The
increase was largely due to an increase in net income of approximately $1.4
million and the increase in the non-cash depletion, depreciation and site
restoration of $1.1 million.

FINANCING ACTIVITIES

Westlinks' ability to maintain and grow its operating income and cash flow
is dependent upon continued capital spending to replace depleting assets.
Westlinks believes its future cash flow from operations, borrowing capacity and
future equity issues should be sufficient to fund capital expenditures and to
service debt. However, our ability to raise additional funds at all, or to do so
on acceptable terms, depends largely on factors beyond our control, such as
world prices for oil and gas, prevailing interest rates, general economic
conditions and the matters discussed above under the caption "Risk Factors".

Westlinks increased total debt by $9.19 million in the first six months of
2000 and by $450,000 in the first six months of 1999. In both periods the funds
were used to acquire capital assets and during the six month period ended June
30, 2000 four wells were drilled. At June 30, 2000, Westlinks had drawn $11.79
million on its $12.5 million revolving operating facility. The facility bears
interest at the bank's prime commercial lending rate plus one quarter of one
percent.

At June 30, 2000, Westlinks was technically in default under the covenants
in the credit facility which require that the debt to equity ratio not exceed
two to one. The bank did allow Westlinks to draw down the credit facility,
knowing that draw down would cause the technical default. Westlinks has advised
the bank of this technical default and also advised the default is anticipated
to be cured by the end of the third quarter from anticipated cash flow.

During the period Westlinks borrowed US$1,500,000 from six non-affiliated
private lenders. The loans bore interest of 12% per annum plus a US$50,000 fee.
We also issued to the lenders warrants to purchase 150,000 shares at US$4.00 per
share. The loans were repaid in full and all of the warrants were exercised on
October 2, 2000.

During the first six months of 2000, $390,000 was raised from the exercise
of common stock options, and applied to our operating activities.

INVESTING ACTIVITIES

15
<PAGE> 18

warrant. The level of capital expenditures will vary in future periods depending
on the success we experience on planned infill drilling activities, oil and gas
price conditions and other related economic factors.

Subsequent to June 30, 2000, Westlinks entered into an agreement to sell
most of our oil and gas assets in the Bigoray area of Alberta. If the
transaction is consummated, as to which there can be no assurance, our proceeds
will be $4,583,500 which will be used to reduce bank debt and for working
capital purposes. The sale is scheduled to close October 26, 2000 and is
effective October 1, 2000.

Investing activities for the first six months of 2000 amounted to
$14,779,475 compared to an inflow of funds in the amount of $22,177 in the first
six months of 1999. The increase in the first six months of 2000 was due to the
Mitsue and Sounding Lake acquisitions, the drilling of three wells in Bigoray
and one well in Sylvan Lake.

During the first six months of 2000 and 1999 several non-core properties
were disposed of for $588,000 and $40,699, respectively. Westlinks defines a
"non-core property" as a property where management believes that opportunities
to increase its value are limited and the property represents less than 20% of
Westlinks' total reserves. The funds received from the sales are typically used
either for future acquisitions or the drilling of new wells consequently the
impact on the results of operations and future liquidity is minimized.

We intend to drill nine wells in the Sylvan Lake area during the third and
fourth quarters of 2000. The total cost of the nine well program will be
approximately $5.9 million. The drilling program will be funded from current
cash flows and from the available credit facility.

RESULTS OF OPERATIONS

Gross revenue from oil and gas production was $6,238,036 in the first six
months of 2000 compared to $824,192 in the first six months of 1999 which
represents an increase of 657%. The increase was due to the Sylvan Lake and
Bigoray acquisitions made late in 1999 and the Mitsue and Sounding Lake
acquisitions during the first half of 2000, offset in part by the property
dispositions during 2000.

Oil revenues before royalties increased 727% in the first six months of
2000 to $6,154,112 from $744,254 in the first six months of 1999. This was due
to increased volumes and higher prices. As a result of project acquisitions and
drilling activities, oil production increased 322% from 40,315 barrels in the
first six months of 1999 to 170,195 barrels in the first six months of 2000.
During the first six months of 2000 we received an average price of $36.16 per
barrel compared to $18.46 per barrel during the first six months of 1999.

Gas revenues before royalties increased 5% in the first six months of 2000
to $83,924 from $79,938 in the corresponding six months of 1999. The increase
was due to higher gas prices. Total volumes decreased from 40,551 million cubic
feet ("mcf") in the first half of 1999 to 24,751 mcf during the first half of
2000 as a result of sales of non-core properties. The average price realized
during the first six months of 2000 was $3.39 per mcf compared to $1.97 per mcf
in the first six months of 1999.

Total net royalties for the first six months of 2000 and 1999 were
$1,278,765 and $87,325, respectively. As a percentage of oil and gas revenues,
royalties were 20.5% during the first six months of 2000 compared to 11% for the
first six months of 1999. The increase was mainly due to our purchase of
producing properties that are not eligible to receive Alberta Royalty Tax
Credits. This credit significantly reduces the impact of provincial Crown
royalties.

In the Province of Alberta, a producer of oil and natural gas is entitled
to a credit against the royalties payable to the province by virtue of the
Alberta royalty tax credit, or ARTC, program. The ARTC rate is based on a
price-sensitive formula and the ARTC rate varies between 75% at prices at and
below $100 per thousand cubic metres and 25% at prices at and above $210 per
thousand cubic metres. The ARTC rate is applied to a maximum of $2,000,000 of
Alberta provincial royalties payable for each producer or associated group of
producers. Provincial royalties on production from producing properties acquired
from a corporation claiming maximum entitlement to ARTC will generally not be
eligible for ARTC. The rate is established quarterly based on the average "par
price" as determined by the Alberta Department of Energy for the previous
quarterly period.

16
<PAGE> 19

Operating expenses increased 310% from $322,155 in the first six months of
1999 to $1,321,225 in the first six months of 2000. On a barrel of oil
equivalent basis operating costs for the first six months of 2000 and 1999 were
$7.65 and $7.26, respectively. The overall increase was due to increased
production from the recent acquisitions. Operating costs increased on a per
barrel basis due to higher costs associated with the Mitsue and Sounding Lake
acquisitions.

We follow the "successful efforts" method of accounting for our oil and gas
exploration and development costs which requires any capital expenditures
incurred that do not result in economical reserves to be charged to exploration
expense. No exploration costs were incurred in either quarters ended June 30,
2000 or 1999.

During the six months ended June 30, 1999, Westlinks was unsuccessful in
implementing a proposal to acquire various interests in independent oil and gas
companies. As a result, we incurred $145,470 of non-recurring merger costs. No
such costs were incurred in the six months ended June 30, 2000.

General and administrative expenses increased 128% from $227,237 during the
first six months of 1999 to $517,736 in the first six months of 2000. On a
barrel of oil equivalent basis administrative costs decreased from $5.12 in the
first six months of 1999 to $3.00 for the corresponding six months in 2000. The
increase in administrative costs was largely due to increasing salaries for the
existing staff and the hiring of additional staff. The decrease in
administrative costs on a barrel of equivalent basis resulted from increased
volumes and our efforts to maintain our current staff level while increasing
production.

Interest expense for the first six months of 2000 was $229,636 compared to
$41,361 in the first six months of 1999. The increase was a result of increased
debt outstanding. At the end of the first six months of 2000, total debt
outstanding was $11.79 million as compared to $1.25 million at the end of the
second quarter of 1999.

Depletion and depreciation for the first six months of 2000 and 1999 was
$1,377,493 and $289,317, respectively. On a barrel of equivalent basis depletion
and depreciation was $7.98 and $6.52. The increase reflects a higher cost base
in our capital assets.

During the first six months of 2000 Westlinks disposed of non-core oil and
gas properties which resulted in a gain of $627,900 compared to a gain of
$39,627 in the corresponding period in 1999.

Future income tax expense amounted to $853,926 in the first six months of
2000 compared to a recovery of $116,145. The expense was a result of the timing
of deductions for accounting purposes and tax on petroleum and gas assets. The
recovery in 1999 was attributable to loss carry forwards not previously
recognized.

Net income for the first six months of 2000 was $1,287,155 as compared to a
loss of $132,832 for the first six months of 1999.

YEAR ENDED DECEMBER 31, 1999 COMPARED TO YEAR ENDED DECEMBER 31, 1998 AND PERIOD
FROM APRIL 1, 1997 THROUGH DECEMBER 31, 1997

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

Westlinks' working capital was a deficit of $1,034,967 at December 31, 1999
compared to a deficit of $17,473 at December 31, 1998. Under U.S. GAAP the
deficit would be $2,559,967 in 1999 and $717,473 in 1998, due to the
reclassification of the long-term debt to current liabilities. The increase in
the deficit between December 31, 1998 and December 31, 1999 was largely due to
the increase in the current portion of the long-term debt from $100,000 to
$1,075,000. At December 31, 1999 and 1998 Westlinks had a revolving reducing
credit facility with a Canadian bank. Under Canadian GAAP, the current portion
of the loan reflects the required reduction in the facility. Annually, the
facility is reviewed and, due to acquisitions and successful drilling results,
the facility has been increased and no loan reductions have been required. The
reduction in the deficit between December 31, 1997 and December 31, 1998 was due
to the replacement of short term debt in the amount of $1,680,538 with long-term
debt.

17
<PAGE> 20

Cash flows provided from operating activities were $293,767 in 1999,
$232,583 in 1998 and $331,667 in 1997. The 1999 decrease can be primarily
attributed to increases in working capital requirements. The decrease in 1998
from 1997 was due to an increase in depletion and depreciation.

FINANCING ACTIVITIES

Westlinks increased total debt by $1.8 million in 1999 and by $800,000 in
1998. The 1999 and 1998 increases were used for capital expenditures. Westlinks
had no long term debt in 1997 but did have an agreement payable of $3.8 million
with respect to the acquisition of I.G. Resources Inc. In 1998 the agreement
payable was paid, financed in part by bank debt.

In 1999 Westlinks raised $1,237,278 from the issue of shares through
private placements and the exercise of stock options. In 1998 no shares were
issued for cash. In 1997 $906,552 was raised by way of private placements and
the exercise of stock options.

INVESTING ACTIVITIES

The timing of most of Westlinks' capital expenditures is discretionary.
Westlinks has no material long-term commitments associated with its capital
expenditure plans or operating agreements. Consequently, Westlinks has a
significant degree of flexibility to adjust the level of such expenditures as
circumstances warrant. The level of capital expenditures will vary in future
periods depending on the success we experience on planned infill drilling
activities, oil and gas price conditions and other related economic factors.

Financing for budgeted expenditures will be accomplished by the use of
internally generated funds, existing credit lines, proceeds from the selective
sale of non-core assets and new equity financing.

Capital expenditures amounted to $3,768,926, $277,021 and $583,509 in 1999,
1998 and 1997, respectively. The increase in 1999 from 1998 was due to the
purchase of two producing properties, Sylvan Lake and Bigoray, in the fourth
quarter, for approximately $3.6 million. Capital expenditures decreased in 1998
compared to 1997 as a result of the acquisition of the assets of I.G. Resources
Inc.'s assets for approximately $3.9 million late in the third quarter of 1997.
In addition, late in 1997, Westlinks purchased all the issued and outstanding
shares of Rainee Resources Ltd. for approximately $452,000.

In 1999 Westlinks purchased all the issued and outstanding shares of a
separate subsidiary for $400,000. This purchase resulted in Westlinks having the
right to acquire the Bigoray property.

The proceeds on disposal of capital assets for 1999, 1998 and 1997 were
$796,800, $2,027,700 and $40,000, respectively. These proceeds were from the
sale of non-core, non-operated oil and gas properties.

RESULTS OF OPERATIONS

Year Ended December 31, 1999 Compared to Year Ended December 31, 1998

Total oil and gas revenue net of royalties was $2,073,121 in 1999 compared
to $1,689,935 in 1998 which represents a 23% increase. The revenue increased due
to higher commodity prices, especially crude oil in the last half of 1999, and
increased oil volumes.

Oil sales revenue before royalties increased 62% from $1,465,292 in 1998 to
$2,379,417 in 1999. This increase was primarily due to a 57% increase in the
realized prices. In 1999, Westlinks' average per barrel crude oil price realized
was $25.45 compared to $16.94 in 1998. The revenue for 1999 has been adjusted to
reflect the cost of Westlinks' hedging program, which totalled $72,882 in 1999.
In addition, oil production

18
<PAGE> 21

increased from 86,511 barrels to 93,487 barrels representing an increase of
approximately 8%. The increase in production was due to acquisitions made in the
fourth quarter of 1999.

During the fourth quarter of 1999, Westlinks made two significant producing
oil property acquisitions at Bigoray and Sylvan Lake. The increase in production
from these properties on a daily basis was 175 barrels per day and 80 barrels
per day, respectively. Actual production during the month of December was 440
barrels of oil equivalent per day compared to the 1999 yearly average of 279
barrels of oil equivalent per day.

Gas revenue before royalties decreased 58% from $320,880 in 1998 to
$136,039 in 1999 as a result of the sale of several non-core properties during
the year. Overall gas production volumes were down 72% from 220,400 mcf in 1998
to 61,068 mcf in 1999. Actual gas prices realized increased from $1.46 per mcf
in 1998 to $2.23 per mcf in 1999.

Total net royalties for 1999 and 1998 were $442,335 and $96,237
respectively. As a percentage of oil and gas revenue, royalties were 18% in 1999
and 5% in 1998. The increase is largely due to Westlinks' purchase of producing
properties that are not eligible to receive Alberta Royalty Tax Credits, which
significantly reduce the impact of Crown royalties, and the settlement of a
gross overriding royalty dispute. During 1998, due to a dispute on the
calculation of gross overriding royalties, Westlinks stopped paying the
royalties. The dispute was resolved in 1999 and the gross overriding royalties
pertaining to 1998 of $56,233 were paid and recorded in 1999. In addition, Crown
royalties are calculated on a sliding scale basis and were impacted by rising
commodity prices.

Operating costs were $782,281 in 1999 which were 8% lower than the 1998
operating costs of $849,107. On a barrel of oil equivalent basis, operating
costs were $7.85 in 1999 compared to $7.82 in 1998. The overall decrease was the
result of the sale of non-core properties with higher operating costs.

Since Westlinks follows the "successful efforts" method of accounting,
capital expenditures that are incurred which do not result in economical
recoverable reserves are charged to exploration expenses. Exploration expenses
were $2,655 in 1999 compared to $3,570 in 1998.

During the year ended December 31, 1999, we were unsuccessful in
implementing a proposal to acquire various interests in independent oil and gas
companies. As a result, Westlinks incurred $145,470 of non-recurring merger
costs. No such costs were incurred in the year ended December 31, 1998.

General and administrative expenses increased 68% from $426,895 in 1998 to
$718,569 in 1999. On a barrel of oil equivalent basis administrative expenses
increased from $3.93 to $7.21. The increase was largely due to a one-time
management restructuring charge of approximately $190,000, representing
severance payments for the termination of two employees, and the addition of
staff during the last quarter as a result of the property acquisitions.
Administrative costs for the fourth quarter of 1999 decreased to $5.04 per
barrel of oil equivalent as a result of the fourth quarter acquisitions.

Interest expense decreased 29% from $185,153 in 1998 to $131,872 in 1999.
The decrease was due to lower debt outstanding for the first three quarters of
1999 as compared to 1998. Due to the acquisitions in the fourth quarter, long
term debt increased to $2.6 million by year end.

Depletion and depreciation for 1999 and 1998 were $841,580 and $804,943
respectively. On a barrel of oil equivalent basis, depletion and depreciation
were $8.45 and $7.42 respectively. The increase reflects a higher cost basis in
Westlinks' capital assets.

During 1999 Westlinks sold several non-core oil and gas properties, which
resulted in a gain of $91,402. In addition, an investment in a private company
was sold which resulted in a gain of $160,000. During 1998, non-core properties
were sold which resulted in a gain of $946,738.

During the years ended December 31, 1999 and December 31, 1998 Westlinks
had interest income of $1,493 and $7,373 respectively. The decrease was due to
lower average cash balances for the 1999 period as compared to the 1998 period.

Net income before taxes for 1999 and 1998 was $(296,411) and $374,378,
respectively.

19
<PAGE> 22

Westlinks accounts for income taxes using the liability method of income
tax allocation. Under this method, income tax assets and liabilities are
recorded to recognize future income tax inflows and outflows arising from the
settlement or recovery of assets and liabilities at the carrying values. Income
tax assets are also recognized for the benefits from tax losses and deductions
that cannot be identified with particular assets or liabilities. The future
income taxes assets and liabilities are determined based on the tax laws and
rates that are anticipated to apply in the period of realization. In 1999,
Westlinks had a future income tax recovery of $246,884 compared to future income
taxes of $120,297 in 1998. The recovery was largely due to loss carryforwards
not previously recognized.

As at December 31, 1999, Westlinks has not paid any income taxes. Westlinks
currently has approximately $485,000 of tax loss carryforwards and $5.3 million
of tax pools, which can be used to reduce future taxes payable.

In 1999, Westlinks reported a net loss of $49,527 compared to net income in
1998 of $254,081.

Year Ended December, 1998 Compared to Period From April 1, 1997 through December
31, 1997

Total oil and gas revenue net of royalties increased 61% from $1,052,358 in
1997 to $1,689,935 in 1998. This overall increase was due to a full year of
production in 1998. Westlinks began operations on April 1, 1997 with four
producing properties. On September 1, 1997 Westlinks acquired I.G. Resources
Inc. which added another ten producing properties and in late December 1997,
Rainee Resources Ltd., an oil and gas producing company, was purchased although
no revenue was attributed to it for 1997.

Oil revenue before royalties in 1998 was $1,465,292 compared to $843,118 in
1997, which represents a 74% increase. The increase was due to increased volumes
offset by lower prices. Oil production increased 144% from 35,386 barrels in
1997 to 86,511 barrels in 1998. The increase was a result of a full year's
production in 1998 as compared to a partial year of production in 1997. In 1998
Westlinks' average crude oil price realized was $16.94 per barrel compared to
$23.83 per barrel in 1997.

Gas revenue before royalties decreased 9% in 1998 to $320,880 as compared
to $353,795 in 1997. The decrease was due to lower prices offset in part by
higher volumes. Actual gas prices realized were $1.46 per mcf in 1998 and $1.98
per mcf in 1997. Total volumes increased from 178,570 mcf in 1997 to 220,400 mcf
in 1998.

Total net royalties for 1998 and 1997 were $96,237 and $144,555,
respectively. As a percentage of oil and gas revenue, royalties were 5% in 1998
and 12% in 1997. The decrease in 1998 was the result of a dispute between
Westlinks and the operating partner of one of the producing properties. As a
result, Westlinks stopped paying the gross overriding royalties. The dispute was
resolved subsequent to 1998 and the royalties were paid and recorded at that
time.

Operating expenses increased 94% from $438,594 in 1997 to $849,107 in 1998.
On a barrel of oil equivalent basis, operating costs were $8.24 in 1997 and
$7.82 in 1998. The overall increase from 1997 to 1998 reflects a full year of
operating costs. Costs decreased on a per barrel basis due to higher production
volumes and Westlinks' continuing efforts to reduce costs.

The "successful efforts" method of accounting requires that capital
expenditures incurred that do not result in economical recoverable reserves must
be charged to exploration expense. Total exploration expenses for 1998 and 1997
were $3,570 and $35,000, respectively.

General and administrative expenses increased 143% from $175,965 in 1997 to
$426,895 in 1998. On a barrel of oil equivalent basis, administrative costs
increased from $3.30 to $3.93 which reflects the hiring of additional staff.

Interest expense increased 150% from $74,128 in 1997 to $185,153 in 1998.
The increase was a result of bank debt being outstanding for most of 1998
compared to four months in 1997. Interest expense in 1997 covered only the
period from September, 1997, when the assets of IG Resources Ltd. were acquired
for $3.9 million, to the end of the year. During 1998, the amount was
outstanding during a portion of the fourth quarter.

20
<PAGE> 23

Depletion and depreciation for 1998 was $804,943 compared to $352,400 in
1997. On a barrel of oil equivalent basis depletion and depreciation was $7.42
and $6.62. The increase reflects a higher cost base in Westlinks' capital
assets.

In 1997 and 1998, Westlinks sold non-core oil and gas properties which
resulted in gains of $280,000 and $946,738, respectively. In addition, in 1997
an investment was sold which resulted in a gain of $13,437. No investments were
sold in 1998. Interest income in 1998 was $7,373 compared to $3,006 in 1997. The
increase was due to a higher average cash balance during 1998 as compared to
1997.

Net income before taxes was $374,378 in 1998 and $272,714 in 1997.

Westlinks accounts for income taxes using the liability method. Future
income taxes in 1998 were $120,297 as compared to $57,464 in 1997. This increase
was due to the difference in the timing of deductions for accounting and tax of
oil and natural gas properties.

OTHER MATTERS

Westlinks may enter into fixed price crude oil and/or natural gas sales
contracts in an attempt to fix future cash flows.

The current increase in commodity prices, combined with a strengthening
economy, has contributed to a slightly stronger Canadian dollar. The pace of
economic recovery in the U. S. has put pressure on the Bank of Canada to raise
short term lending rates, which has pushed Canadian prime lending rates to 7.5%,
increasing Westlinks' cost to borrow money.

Accessing capital when required and at competitive rates is highly
dependent on market conditions. Westlinks has utilized various financing
vehicles to fund its capital programs, including private placements of common
shares and asset sales. Westlinks continuously monitors its capital mix, paying
particular attention to its debt levels, as market conditions remain volatile.
There can be no assurance that Westlinks can continue to raise funds to finance
its capital programs.

There are numerous uncertainties inherent in estimating quantities of
reserves and the cash flows that would result from these reserves, many of which
are beyond our control.

Our future reserves, production and cash flows are dependent on our success
in developing our current reserve base and acquiring additional property for
development. Without the addition of reserves, our existing reserves and
production are subject to continued decline.

Effective January 1, 2000, Westlinks sold one-half of our non-core,
non-operated oil and gas assets in the Weyburn area to Red Raven Resources Inc.
for consideration of $1,018,000. We used $430,000 of the consideration to
purchase 1,720,000 shares of Red Raven.

Effective August 1, 2000, we disposed of our remaining non-core oil and gas
assets in the Weyburn area of Saskatchewan for consideration of $350,000.

We have entered into a letter of intent to sell substantially all of our
oil and gas assets in the Bigoray area of Alberta for cash consideration of
$4,583,500. We are retaining the natural gas rights in the Belly River
formation. The sale is scheduled to close October 26, 2000 and will be effective
from October 1, 2000.

21
<PAGE> 24

BUSINESS

HISTORY

Westlinks was organized on June 30, 1998 by the statutory amalgamation of
Temba Resources Ltd. and PTR Resources Ltd. under the laws of the Province of
Alberta, Canada. An amalgamation is the consolidation of the two amalgamating
companies, and is a continuation of both businesses. Our predecessor, Temba
Resources Ltd., was incorporated in Alberta on July 31, 1996 and at the time of
the amalgamation had acquired oil and gas production of approximately 27 barrels
of oil per day and 106 thousand cubic feet of gas per day from 19 oil wells and
one gas well. Immediately prior to the amalgamation which created Westlinks,
Temba Resources amalgamated with its wholly owned subsidiary, Rainee Resources
Ltd. Our predecessor, PTR Resources, was incorporated in Alberta on September
18, 1992 as 542275 Alberta Ltd.; changed its name to Ablevest Holdings Ltd. on
January 14, 1993, and to PTR Resources on December 1, 1997. PTR Resources
originally held a 2.5% working interest in mineral leases on 8.5 sections of
land in Alberta.

OUR BUSINESS

We are an operating oil and gas company that drills, operates and exploits
crude oil and natural gas wells in our core areas in western Canada. Our capital
budget for 2000 of approximately $5.9 million, which is subject to available
funds, includes amounts for drilling nine development wells in our core areas.
The 2000 drilling is currently anticipated to be spent on wells drilled in the
Sylvan Lake area, but each specific site and area is subject to the results of
our analysis of seismic studies and the results of our previous drilling, and
the development of new opportunities as the year progresses.

GLOSSARY OF PETROLEUM INDUSTRY TERMS

The following definitions of certain terms used in the oil and gas industry
will assist you in understanding our business:

"DEVELOPMENTAL WELLS" are wells drilled for oil or gas within a proven field for
the purpose of completing the desired pattern of production;

"INFIELD AND STEP-OUT WELLS" mean wells which have been drilled either in
between or on the outside edge of other nearby producing wells;

"NON-OPERATED PROPERTY" means a well which is managed by a third party;

"PERMEABILITY" means the ability of a porous rock to transmit fluid through its
pore spaces. A rock may be highly porous and yet be impermeable if it has no
interconnecting pore network communication;

"PETROPHYSICAL DATA" means the rock parameters associated with a reservoir,
including thickness, porosity, permeability;

"POROSITY" means the ability of a rock to contain fluids. It is the volume of
pore spaces between mineral grains, expressed as a percentage of the total rock
volume;

"RESERVOIR" means a porous, permeable sedimentary rock structure or trap
containing oil and/or gas;

"SPUDDING" means the commencement of the drilling of a well;

"WATERFLOOD" means the injection of water into an oil reservoir in order to
enhance production;

"WATER INJECTION WELL" means a well used to inject water into an oil reservoir
in order to conduct a waterflood; and

"WILDCAT" means a well drilled in an area where oil and gas has not been
previously found.

"WORKING INTEREST" means the percent of production, before royalties, to which a
party is entitled.

22
<PAGE> 25

BUSINESS STRATEGY

We have an experienced management team that attempts to apply as many as
possible of the following strategies to the search for oil and gas:

Low Risk Development Projects

We concentrate our efforts on oil and gas properties that offer
opportunities for low risk development. Typical types of low risk developments
are the drilling of infield and step-out wells, the installation of central
facilities to handle higher production volumes and the completion of other
productive zones within wells.

Consolidation of Adjacent Assets

We seek property acquisitions and development opportunities on lands that
are in close proximity to our producing fields. These close-in acquisitions
create the ability to reduce operating costs by consolidating facilities.
Moreover, drilling costs are lower when wells are drilled as part of a
multi-well program, due to reduced rig moving costs and other efficiencies.

Cost Effective Acquisitions

We seek to acquire oil and gas producing properties at prices that allow
the base production for the property to pay the acquisition cost within a
reasonable time frame. We attempt to avoid paying for unproven reserves in the
purchase price.

Emphasis on Development Drilling

We concentrate our drilling activities on low risk development wells
located in or near our established core production areas. This strategy helps to
reduce risk and costs, and enables new wells to be put on production more
quickly. We generally do not engage in high-risk exploratory or "wildcat"
drilling.

Use of Seismic and Other Data in Site Selection

We use the analysis of seismic data, including three dimensional seismic,
whenever its use is appropriate for the geology and is cost effective, to
further minimize drilling risk. We also use information from adjacent wells,
including petrophysical data, production records and completion data to help
reduce our risk and costs.

Selection of Properties

We select properties for acquisition and development where we believe we
can become the operator and that we believe offer us the opportunity to reduce
operating costs and maximize economies of scale, thereby improving operating
profitability. We have used this strategy in development of our core areas in
central Alberta, an area of moderate drilling costs, multi-zone potential, year
round accessibility and good gas plant and pipeline infrastructure.

SUMMARY OF OIL AND GAS OPERATIONS

Capitalized costs at December 31, 1997, 1998 and 1999 relating to
Westlinks' oil and gas activities, expressed in Canadian dollars, are summarized
as follows:

<TABLE>
<CAPTION>
1997(1) 1998 1999
------- ---- ------
<S> <C> <C> <C>
Property acquisition........................................ $ 500 $244 $2,659
======= ==== ======
Exploration................................................. $ -- $ -- $ --
======= ==== ======
Development................................................. $ 50 $ 27 $ 341
======= ==== ======
</TABLE>

---------------

(1) From commencement of activities on April 1, 1997.

23
<PAGE> 26

PROPERTIES

Westlinks' current oil and gas operations and activities are focused in
four core areas, plus some minor properties in a non-core area, described below.
In accordance with the standard practice in the Canadian oil and gas industry,
the working interests described below are the percentage ownership of the oil
and gas production before payment of royalties.

Bigoray Area, Alberta

The Bigoray property, consisting of an 89% working interest in 1,280 acres
of land, including one producing oil well, one water injection well, and five
suspended oil wells, was acquired by Westlinks in September, 1999. We are the
operator of this property. The Bigoray property is located in central Alberta,
about 70 miles west of the city of Edmonton, in a forested area on government
owned lands. Light crude oil is produced from reservoirs within the Cretaceous
Cardium Formation, at a depth of about 4,700 feet, which is up to 45 feet thick,
along with shallower Belly River Formation reservoirs, which are up to 25 feet
thick. The Cardium oil pool was deposited as an off-shore marine bar and
consists of course-grained sandstones and conglomerates. It has been under
waterflood to increase the recovery of oil since 1982. Cumulative production of
oil from the property from the Cardium formation has been about 2.2 million
barrels. The crude is light at 32 degree API, API being an indication of
specific gravity of crude oil measured on the American Petroleum Institute
gravity scale, and sweet, meaning low in sulphur, and is transported via
pipeline to Edmonton. Good infrastructure is in place, including roads,
electricity, pipelines, and producing facilities.

At the time of purchase, the property was producing about 100 barrels per
day of oil from one well. In November, 1999 Westlinks re-completed a suspended
well as a Belly River oil well which increased the total operated Bigoray
production to about 150 barrels per day of oil. The Belly River formation
consists of fine to medium grained well-sorted sandstones, deposited in
coarsening-upward shoreline sequences, which pass laterally and upward into
marine shales. Commencing in February, 2000, Westlinks drilled three Cardium
development wells of which two were successfully completed as oil wells. Current
production from the field is approximately 275 barrels of oil per day.

Westlinks has entered into an agreement, effective October 1, 2000, to sell
all of its Bigoray assets except natural gas in the Belly River Formation, for
cash consideration of $4,583,500. The sale is scheduled to close October 26,
2000 and will be effective from October 1, 2000. Proceeds from the sale will be
used to reduce our bank debt and for the 2000 drilling program.

Mitsue Area, Alberta

The Mitsue property, consisting of a 94% working interest in 9,920 acres of
land, including three producing oil wells, was acquired by Westlinks in
February, 2000. We are the operator of this property. The Mitsue property is
located in Northern Alberta, about 125 miles northwest of the city of Edmonton.
The property is located in a forested area on Government owned lands. Light, 43
degree API, sweet crude oil is produced from the Devonian Gilwood sand formation
at a depth of about 5,600 feet, which is up to 30 feet thick. Oil production has
averaged approximately 90 barrels of oil per day.

The property is adjacent to a large Gilwood sand unit that is operated by a
major oil company. Westlinks' oil is produced through flow lines to facilities
operated by the unit, and then pipelined to Edmonton. Westlinks acquisition in
Mitsue was for the Gilwood sand formation only and the vendor retains the rights
to other formations. There are a number of suspended wells on the Mitsue
property, which we can elect to retain or return to the vendor. Wells we elect
to keep can be re-worked, but Westlinks will be responsible for the costs of
abandoning the wells it elects to keep. The property also has a large inventory
of good quality oilfield equipment which Westlinks has the right to salvage for
sale or use in development at Mitsue or elsewhere. Westlinks has identified two
suspended Gilwood sand oil wells that can be re-equipped for production. A
reservoir study is being undertaken to help plan development for the area.
Development options include the re-activation of shut in wells, waterflood
modifications and the drilling of additional wells.

24
<PAGE> 27

Sounding Lake Area, Alberta

The Sounding Lake area is located in east central Alberta. Oil production
from the Sounding Lake area is taken from Cretaceous aged sandstone reservoirs
known as the Dina, Cummings and the General Petroleum encountered at depths of
about 2,800 feet or less. In 1998 we acquired a non-operated working interest
averaging about 20% in a Dina sand pool with oil pay thickness of up to 20 feet
at Sounding Lake consisting of 1,270 acres and about 35 producing wells. In May,
2000, Westlinks acquired, effective January 1, 2000, working interests of about
36% in this pool as well as working interests averaging about 91% in 21
producing oil wells. We are the operator of the newly acquired assets in
Sounding Lake. The oil gravity averages about 30 degrees API. The area is
primarily farm land and there is well developed infrastructure in place.
Westlinks' current oil production from the area is over 950 barrels per day and
gross land interests total about 6,400 acres. Potential development for the area
consists of the consolidation of facilities, the implementation of a waterflood,
and the drilling of additional wells.

The portion of the Sounding Lake assets purchased in 2000 had a purchase
price of $11.9 million, which was financed by loans from a group of unaffiliated
investors, plus some bank financing and working capital. Net proceeds from this
offering will be used to repay the investor loans. The Sounding Lake acquisition
was effective January 1, 2000.

KPMG LLP, Chartered Accountants of Calgary, Canada audited the Schedule of
Revenues and Expenses of the Properties Acquired in Sounding Lake for the past
three years. The report is summarized in the following table.

SOUNDING LAKE PROPERTIES

SCHEDULE OF REVENUES AND EXPENSES

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
-----------------------------------------
1999 1998 1997
----------- ----------- -----------
<S> <C> <C> <C>
Revenue............................................. $7,431,844 $ 5,764,638 $ 4,512,995
Royalties........................................... (1,224,260) (951,500) (740,565)
Operating expenses.................................. (1,815,566) (1,762,301) (1,068,060)
----------- ----------- -----------
Excess of revenues over expenses.................... $4,392,018 $ 3,050,837 $ 2,704,370
=========== =========== ===========
</TABLE>

The following table sets out the production from the Sounding Lake
production and reserves for the periods shown, and the estimated reserves and
net present value. The reserve estimates were back calculated based on the April
1, 2000 report of Grant Trimble Engineering Ltd. and the actual production, and
we assumed that the estimated net present value per barrel of oil equivalent was
constant.

<TABLE>
<CAPTION>
OIL GAS OIL GAS
GROSS GROSS NET NET
MSTB MMCF MSTB MMCF UNDISC. NPV@10% NPV@12% NPV@15% NPV@20%
------ ----- ------ ---- ------- ------- ------- ------- -------
M$
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Dec. 31, 1996........ 2160.8 44.1 1837.4 36.0 46753 31358 29540 27241 24244
Production........... 191.6 0.0 160.9 0.0
Dec. 31,1997......... 1969.2 44.1 1676.5 36.0 42607 28578 26921 24825 22094
Production........... 364.9 12.6 306.5 10.6
Dec. 31, 1998........ 1604.3 31.5 1370.0 25.4 34712 23282 21932 20225 18000
Production........... 305.0 18.5 258.2 16.5
Dec. 31, 1999........ 1299.3 13.0 1113.8 9.8 28113 18856 17763 16380 14578
Production........... 14.6 0.9 12.3 0.7
April 1, 2000........ 1284.7 12.1 1101.5 9.1 27797 18644 7563 16196 14414
</TABLE>

25
<PAGE> 28

Sylvan Lake Area, Alberta

The Sylvan Lake property is located in central Alberta, about 15 miles west
of the City of Red Deer. Westlinks has a working interest of 94% in four
producing oil wells and a saltwater disposal well on about 2,080 acres. The
property is located in an area of mixed farming and can be accessed year-round.
Heavy crude oil of 16 degree API is produced from the Mississippian Pekisko
formation. The producing zone is up to 120 feet thick. Good infrastructure is in
place, including roads, electricity, and producing facilities. Westlinks
acquired the Sylvan Lake property in September, 1999.

Since acquiring the property we have modified the facilities and
streamlined the operations to prepare for additional development. Westlinks has
negotiated a farmin and option agreement on another 640 acres of land adjacent
to its holdings. A farmin is an agreement to drill mineral rights owned or
leased by another party, in which interests are earned by the party drilling the
wells. Westlinks is currently finalizing interpretation of a three dimensional
seismic survey that was recently shot over its land. Westlinks drilled and
completed a development well in May 2000 which is producing at an average of 100
barrels of oil per day. We have drilled four more successful wells in Sylvan
Lake, which are in various stages of completion. Westlinks has identified
several additional drilling locations on its lands in Sylvan Lake, including the
final location identified in the report by our independent engineers, Grant
Trimble Engineering Ltd., and up to four wells which are contingent on drilling
success.

RESERVES AND PRESENT VALUE SUMMARY

The estimated oil and natural gas reserves of Westlinks and the associated
estimated present value of estimated future net cash flows have been evaluated
in a report as of April 1, 2000 prepared by Grant Trimble Engineering Ltd.,
independent engineers of Calgary, Alberta. As requested by Westlinks, the Grant
Trimble report adopted certain information and findings from two recent reports
prepared by another engineering firm, without further review. This permitted a
consolidation of reserves and present value for all of Westlinks' holdings at
April 1, 2000, including acquisitions in the Mitsue and Sounding Lake areas
which closed in May, 2000 and were effective January 1, 2000. Accordingly,
various references were made to the reports of the other engineering firm for
Sylvan Lake dated September 1, 1999 and Bigoray dated July 1, 1999.

The following table is based on the Grant Trimble report and shows the
estimated share of the remaining oil, natural gas and natural gas liquids
attributable to Westlinks and the estimated present value of estimated future
net cash flows for these reserves, using constant prices and costs. All
estimates of present value of future net cash flows are stated after provision
for capital expenditures required to generate such revenues but prior to
provision for indirect costs such as general and administrative overhead, income
or production taxes, interest expense or abandonment liabilities, and prior to
income tax. It should not be assumed that the estimated present values of future
net cash flows are representative of the fair market value of the reserves.
These recovery and reserve estimates of Westlinks' interests in the described
properties are estimates only; the actual reserves in the properties in which we
have an interest may be more or less than those calculated. Assumptions and
qualifications relating to costs, prices and other matters are summarized in the
notes to the following table. The extent and character of the material
information supplied by Westlinks including, but not limited to, ownership, well
data, production, price, revenues, operating costs and contracts were relied
upon by Grant Trimble Engineering Ltd. in preparing the report. In the absence
of such information, Grant Trimble Engineering Ltd. relied upon their opinion of
reasonable practice in the industry. The Grant Trimble report may be examined at
the office of Westlinks located at Suite 700, 703 - 6th Avenue S.W., Calgary,
Alberta during normal business hours. All monetary amounts are expressed in
Canadian dollars.

26
<PAGE> 29

ESTIMATED PETROLEUM AND NATURAL GAS RESERVES AND PRESENT WORTH AS AT APRIL 1,
2000(1)(2)

<TABLE>
<CAPTION>
RESERVES PRESENT WORTH -- BEFORE INCOME TAX
----------------- -------------------------------------------
CATEGORY PRODUCT GROSS NET UNDISC. 10% 12% 15% 20%
-------- ------- ------- ------- ------- ------ ------ ------ ------
M$
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Proved developed Crude Oil (Mbbl) 2,617.7 2,203.8 57,424 38,682 36,431 33,569 29,813
Sales Gas (Mmcf) 97.0 69.3 -- -- -- -- --
C5 (Mbbl) 10.8 7.3 -- -- -- -- --
C3 (Mbbl) 14.7 10.3 -- -- -- -- --
ARTC 636 481 460 432 393
------ ------ ------ ------ ------
TOTAL Proved developed with ARTC 58,060 39,163 36,891 34,001 30,206
====== ====== ====== ====== ======
Total Proved Crude Oil (Mbbl) 3,132.9 2,679.7 66,200 43,293 40,531 37,018 32,408
Sales Gas (Mmcf) 795.2 623.3 -- -- -- -- --
C5 (Mbbl) 16.4 11.0 -- -- -- -- --
C3 (Mbbl) 14.7 10.3 -- -- -- -- --
ARTC 1,032 802 769 726 665
------ ------ ------ ------ ------
TOTAL Proved with ARTC 67,232 44,095 41,300 37,744 33,072
====== ====== ====== ====== ======
</TABLE>

---------------

Notes:

(1) Definitions:

"ARTC" means the Alberta Royalty Tax Credit.

"C3" means propane.

"C5" means condensate.

"Gross" means the total of Westlinks' working interest share of reserves
before deduction of Royalties.

"Mbbl" means thousands of barrels.

"Mmcf" means millions of cubic feet.

"Net" means gross reserves after deduction of Royalties. In order to
estimate reserves after giving effect to the deduction of provincial
royalties, certain assumptions must be made including forecasts of future
prices and production. The net reserves are based on forecasts by Grant
Trimble Engineering Ltd. of these and other factors necessary to estimate
provincial and other royalties.

"Oil" means crude oil.

"Proved oil and gas reserves" are the estimated quantities of crude oil,
natural gas, and natural gas liquids which geological and engineering data
demonstrate with reasonable certainty to be recoverable in future years from
known reservoirs under existing economic and operating conditions, i.e.,
prices and costs as of the date the estimate is made. Prices include
consideration of changes in existing prices provided only by contractual
arrangements, but not on escalations based upon future conditions.

"Proved developed oil and gas reserves" are reserves that can be expected
to be recovered through existing wells with existing equipment and
operating methods. Additional oil and gas expected to be obtained through
the application of fluid injection or other improved recovery techniques
for supplementing the natural forces and mechanisms of primary recovery are
included. Only after testing by a pilot project or after the operation of
an installed program has confirmed through production response that
increased recovery will be achieved.

"Royalties" means royalties paid to others. The royalties deducted from the
reserves are based on the percentage royalties calculated by applying the
applicable royalty rate or formula. In the case of Crown (the federal or
provincial governments in Canada) sliding scale royalties which are
dependent on selling price, the price forecasts for the individual
properties in question have been employed.

"Sales Gas" means natural gas which is produced for commercial sale.

(2)The commodity prices used in the Grant Trimble report are based on a West
Texas Intermediate ("WTI") oil price of US$25.00, at December 31, 1999
adjusted for actual Canadian dollar exchange

27
<PAGE> 30

rates, pipeline charges and quality differences for each well, with that
price being held unescalated throughout the term of the report.

In a report dated October 2, 2000, Grant Trimble Engineering Ltd. revised
the Grant Trimble Report at April 1, 2000 to delete the Bigoray and Weyburn area
reserves, as the Weyburn assets were sold effective August 1, 2000, and the
Bigoray assets are in the process of being sold. The following table sets out
Westlinks' estimated petroleum and natural gas reserves and present worth at
April 1, 2000. The assumptions and qualifications are the same as the Grant
Trimble Report. The revised report may be examined at Westlinks' office located
at Suite 700, 703 - 6th Avenue S.W., Calgary, Alberta during normal business
hours. All monetary amounts are expressed in Canadian dollars.

ESTIMATED PETROLEUM AND NATURAL GAS RESERVES AND PRESENT WORTH AS AT APRIL 1,
2000

WITHOUT BIGORAY OR WEYBURN

<TABLE>
<CAPTION>
RESERVES PRESENT WORTH -- BEFORE INCOME TAX
----------------- -------------------------------------------
CATEGORY PRODUCT GROSS NET UNDISC. 10% 12% 15% 20%
-------- ------- ------- ------- ------- ------ ------ ------ ------
M$
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Proved developed Crude Oil (Mbbl) 2,042.0 1,743.8 43,793 29,041 27,317 25,139 22,305
Sales Gas (Mmcf) 70.0 50.1 -- -- -- -- --
C5 (Mbbl) 7.6 5.1 -- -- -- -- --
ARTC 229 163 155 144 130
------ ------ ------ ------ ------
Total Proved developed with ARTC 44,022 29,204 27,471 25,283 22,435
====== ====== ====== ====== ======
Total Proved Crude Oil (Mbbl) 2,557.2 2,219.8 52,480 33,580 31,347 28,523 24,840
Sales Gas (Mmcf) 696.0 545.2 -- -- -- -- --
C5 13.1 8.8 -- -- -- -- --
ARTC 618 477 457 431 395
------ ------ ------ ------ ------
Total Proved with ARTC 53,098 34,057 31,805 28,954 25,234
====== ====== ====== ====== ======
</TABLE>

HISTORICAL RESERVES

The following table sets out Westlinks' proved oil and gas reserves at
December 31, 1999, 1998 and 1997 respectively and the present value at December
31, 1999. The amounts for December 31, 1999 are based upon a report prepared for
Westlinks by Grant Trimble Engineering Ltd. at December 31, 1999. Abbreviations
and price forecasts are as set out above for the April 1, 2000 report. The
monetary amounts are expressed in Canadian dollars. The reserve numbers for
December 31, 1998 and 1997 were prepared internally by Westlinks, based upon
reserve reports prepared at various dates by independent engineering firms and
adjusted for actual production. Present value amounts are not available as it is
not feasible to redo such calculations after the fact.

<TABLE>
<CAPTION>
DECEMBER 31,
----------------------
1999 1998 1997
----- ---- -----
<S> <C> <C> <C>
Proved Producing Reserves
Oil and NGLs (thousands of barrels)....................... 1,054 588 560
Gas (millions of cubic feet).............................. 107 417 2,957
Proved Reserves
Oil (thousands of barrels)................................ 1,539 604 560
Gas (millions of cubic feet).............................. 617 417 5,873
</TABLE>

LAND HOLDINGS

Westlinks does not have any lands which are separate from the producing
properties described above.

28
<PAGE> 31

PRODUCTION

The following table summarizes Westlinks' working interest production
during the periods indicated.

<TABLE>
<CAPTION>
YEARS ENDED
SIX MONTHS DECEMBER 31
ENDED --------------------
JUNE 30, 2000 1999 1998 1997
------------- ---- ---- ----
<S> <C> <C> <C> <C>
Oil and NGL's (MBbls)...................................... 170 93 86 79
Gas (MMcf)................................................. 24 61 220 58
Total (MBOE)............................................... 173 100 108 85
Average Production in BOEPD................................ 948 274 296 233
</TABLE>

Definitions:

"BOEPD" means barrels of oil equivalent produced per day.

"MBOE" means thousands of barrels of oil equivalent, meaning one barrel of
oil or one barrel of natural gas liquids or ten mcf of natural gas.

"MBbls" means thousands of barrels, with respect to production of crude oil
or natural gas liquids.

"MMcf" means millions of cubic feet, with respect to production of natural
gas.

"NGL's" means natural gas liquids, being those hydrocarbon components
recovered from raw natural gas as liquids by processing through extraction
plants or recovered from field separators, scrubbers or other gathering
facilities. These liquids include the hydrocarbon components ethane, propane,
butanes and pentanes plus, or a combination thereof.

DRILLING

For the periods indicated, Westlinks has drilled or participated in the
drilling and/or re-entry of seven gross wells (5.13 net wells) as follows:

<TABLE>
<CAPTION>
PERIOD ENDED YEARS ENDED DECEMBER 31,
OCTOBER 18, -----------------------------------------------
2000 1999 1998 1997
------------- ------------- ------------- -------------
GROSS NET GROSS NET GROSS NET GROSS NET
----- ---- ----- ---- ----- ---- ----- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Oil............................. 7 6.48 0 0.00 0 0.00 0 0.00
Natural Gas..................... 2 1.27 0 0.00 0 0.00 0 0.00
Abandoned....................... 2 1.14 0 0.00 1 0.13 0 0.00
-- ---- -- ---- -- ---- -- ----
Total........................... 11 8.89 0 0.00 1 0.13 0 0.00
== ==== == ==== == ==== == ====
</TABLE>

---------------

Notes:

(1) "Gross" wells means the number of whole wells.

(2) "Net" wells means Westlinks' working interest in the gross wells.

29
<PAGE> 32

CAPITAL EXPENDITURES

The following table summarizes the capital expenditures made by Westlinks
during the periods indicated, expressed in Canadian dollars:

<TABLE>
<CAPTION>
SIX MONTHS YEARS ENDED DECEMBER 31,
ENDED JUNE 30, -------------------------
2000 1999 1998 1997
-------------- ------- ----- -----
(IN THOUSANDS)
<S> <C> <C> <C> <C>
Land................................................ $11,721 $2,659 $244 $500
Drilling (exploration and development).............. 1,808 341 27 50
Seismic............................................. 185 17 -- --
Facilities.......................................... 1,400 728 4 --
Miscellaneous....................................... 3 24 2 34
------- ------ ---- ----
Total............................................... $15,117 $3,769 $277 $584
======= ====== ==== ====
</TABLE>

OIL AND GAS WELLS

The following table summarizes Westlinks' interest in producing and
non-producing oil and gas wells as at July 31, 2000:

<TABLE>
<CAPTION>
NON-PRODUCING
OIL AND GAS WELLS
PRODUCING PRODUCING CAPABLE OF
OIL WELLS GAS WELLS PRODUCTION
------------- ------------ -----------------
ALBERTA GROSS NET GROSS NET GROSS NET
------- ----- ---- ----- --- --------- ----
<S> <C> <C> <C> <C> <C> <C>
Bigoray...................................... 5 4.4 0 0 0 0.0
Mitsue....................................... 3 2.7 0 0 2 1.88
Sounding Lake East........................... 8 7.9 0 0 0 0.0
Sounding Lake West........................... 26 12.4 0 0 0 0.0
Sounding Lake North.......................... 10 8.5 0 0 0 0.0
Sylvan Lake.................................. 4 3.8 0 0 0 0.0
-- ---- -- -- -- ----
TOTAL WELLS.................................. 56 39.7 0 0 2 1.88
== ==== == == == ====
TOTAL WELLS WITHOUT BIGORAY.................. 51 35.3 0 0 2 1.88
== ==== == == == ====
</TABLE>

EMPLOYEES

At October 18, 2000, we employed eight people in our head office. The field
operations are handled by an independent contract operator.

COMPETITION

The petroleum industry is highly competitive. Westlinks competes with
numerous other participants in the acquisition of oil and gas leases and
properties, and the recruitment of employees. Any company can make acquisitions
and bid on provincial leases in Alberta. Competitors include oil companies which
have greater financial resources, staff and facilities than those of Westlinks.
Our ability to increase reserves in the future will depend not only on our
ability to develop existing properties, but also on our ability to select and
acquire suitable additional producing properties or prospects for drilling. We
also compete with numerous other companies in the marketing of oil. Competitive
factors in the distribution and marketing of oil include price and methods and
reliability of delivery.

OFFICE FACILITIES

Westlinks currently leases 6,518 square feet of office space at Suite 700,
703 - 6th Avenue S.W. in Calgary, Alberta in a lease which commenced September
1, 2000. The lease has a five year term and the annual rental is $10.00 per
square foot plus annual operating costs which are currently $7.27 per square
foot.

30
<PAGE> 33

GOVERNMENT REGULATION IN CANADA

The oil and natural gas industry is subject to extensive controls and
regulations governing its operations, including land tenure, exploration,
development, production, refining, transportation and marketing, imposed by
legislation enacted by various levels of government and with respect to pricing
and taxation of oil and natural gas by agreements among the governments of
Canada, Alberta, Saskatchewan and British Columbia, all of which should be
carefully considered by investors in the Canadian oil and gas industry. It is
not expected that any of these controls or regulations will affect the
operations of Westlinks in a manner materially different from how they would
affect other oil and gas companies of similar size operating in Western Canada.
All current legislation is a matter of public record and Westlinks is unable to
predict what additional legislation or amendments may be enacted. Outlined below
are some of the principal aspects of legislation, regulations and agreements
governing the oil and gas industry.

Pricing and Marketing -- Oil and Natural Gas

The producers of oil are entitled to negotiate sales contracts directly
with oil purchasers, with the result that the market determines the price of
oil. Such price depends in part on oil quality, prices of competing oils,
distance to market, the value of refined products and the supply/demand balance.
Oil exporters are also entitled to enter into export contracts with terms not
exceeding one year in the case of light crude oil and two years in the case of
heavy crude oil, provided that an order approving such export has been obtained
from the National Energy Board of Canada, or NEB. Any oil export to be made
pursuant to a contract of longer duration, to a maximum of 25 years, requires an
exporter to obtain an export licence from the NEB and the issuance of such
licence requires the approval of the Governor in Council. In addition, the
prorationing of capacity on the interprovincial pipeline systems continues to
limit oil exports.

The price of natural gas is determined by negotiation between buyers and
sellers. Natural gas exported from Canada is subject to regulation by the NEB
and the Government of Canada. Exporters are free to negotiate prices with
purchasers, provided that the export contracts meet certain other criteria
prescribed by the NEB and the Government of Canada. Natural gas exports for a
term of less than two years or for a term of two to twenty years, in quantities
of not more than 30,000 m(3)/day, must be made pursuant to an NEB order. Any
natural gas export to be made pursuant to a contract of longer duration, up to a
maximum of 25 years, or a larger quantity, requires an exporter to obtain an
export licence from the NEB and the issuance of such licence requires the
approval of the Governor in Council.

The governments of British Columbia, Alberta and Saskatchewan also regulate
the volume of natural gas which may be removed from those provinces for
consumption elsewhere based on such factors as reserve ability, transportation
arrangements and market considerations.

The North American Free Trade Agreement

The North American Free Trade Agreement, or NAFTA, entered into among the
governments of Canada, United States of America and Mexico became effective on
January 1, 1994. NAFTA carries forward most of the material energy terms that
are contained in the Canada - United States Free Trade Agreement. Canada
continues to remain free to determine whether exports of energy resources to the
United States or Mexico will be allowed, provided that any export restrictions
do not:

- reduce the proportion of energy resources exported relative to domestic
use (based upon the proportion prevailing in the most recent 36 month
period);

- impose an export price higher than the domestic price; or

- disrupt normal channels of supply.

All three countries are prohibited from imposing minimum export or import
price requirements.

NAFTA contemplates the reduction of Mexican restrictive trade practices in
the energy sector and prohibits discriminatory border restrictions and export
taxes. The agreement also contemplates clearer

31
<PAGE> 34

disciplines on regulators to ensure fair implementation of any regulatory
changes and to minimize disruption of contractual arrangements, which is
important for Canadian natural gas exports.

Provincial Royalties and Incentives

In addition to federal regulation, each province has legislation and
regulations which govern land tenure, royalties, production rates, environmental
protection and other matters. The royalty regime is a significant factor in the
profitability of crude oil, natural gas liquids, sulphur and natural gas
production. Royalties payable on production from lands other than Crown lands
are determined by negotiations between the mineral owner and the lessee,
although production from such lands is subject to certain provincial taxes and
royalties. Crown royalties are determined by governmental regulation and are
generally calculated as a percentage of the value of the gross production. The
rate of royalties payable generally depends in part on prescribed reference
prices, well productivity, geographical location, field discovery date and the
type or quality of the petroleum product produced.

From time to time the governments of the western Canadian provinces create
incentive programs for exploration and development. Such programs often provide
for royalty rate reductions, royalty holidays and tax credits, and are generally
introduced when commodity prices are low. The programs are designed to encourage
exploration and development activity by improving earnings and cash flow within
the industry.

In the Province of Alberta, a producer of oil or natural gas is entitled to
a credit against the royalties payable to the Crown by virtue of the Alberta
royalty tax credit or, ARTC program. The ARTC rate is based on a price sensitive
formula and the ARTC rate varies between 75% at prices at and below $100 per
thousand cubic metres and 25% at prices at and above $210 per thousand cubic
metres. The ARTC rate is applied to a maximum of $2,000,000 of Alberta Crown
royalties payable for each producer or associated group of producers. Crown
royalties on production from producing properties acquired from a corporation
claiming maximum entitlement to ARTC will generally not be eligible for ARTC.
The rate will be established quarterly based on the average "par price", as
determined by the Alberta Department of Energy for the previous quarterly
period.

On December 22, 1997, the Alberta government announced that it was
conducting a review of the ARTC program with the objective of setting out better
targeted objectives for a smaller program and to deal with administrative
difficulties. On August 30, 1999, the Alberta government announced that it would
not be reducing the size of the program but that it would introduce new rules to
reduce the number of persons who qualify for the program. The new rules will
preclude companies that pay less than $10,000 in royalties per year and
non-corporate entities from qualifying for the program. Such rules will not
presently preclude Westlinks from being eligible for the ARTC program.

Crude oil and natural gas royalty holidays for specific wells and royalty
reductions reduce the amount of Crown royalties paid by Westlinks to the
provincial governments. In general, the ARTC program provides a rebate on
Alberta Crown royalties paid in respect of eligible producing properties.

Land Tenure

Crude oil and natural gas located in the western provinces is owned
predominantly by the respective provincial governments. Provincial governments
grant rights to explore for and produce oil and natural gas pursuant to leases,
licences and permits for varying terms from two years and on conditions set
forth in provincial legislation including requirements to perform specific work
or make payments. Oil and natural gas located in such provinces can also be
privately owned and rights to explore for and produce such oil and natural gas
are granted by lease on such terms and conditions as may be negotiated.

Environmental Regulation

The oil and natural gas industry is currently subject to environmental
regulations pursuant to a variety of provincial and federal legislation. Such
legislation provides for restrictions and prohibitions on the release or
emission of various substances produced in association with certain oil and gas
industry operations. In

32
<PAGE> 35

addition, such legislation requires that well and facility sites be abandoned
and reclaimed to the satisfaction of provincial authorities. Compliance with
such legislation can require significant expenditures and a breach of such
requirements may result in suspension or revocation of necessary licenses and
authorizations, civil liability for pollution damage and the imposition of
material fines and penalties.

Environmental legislation in the Province of Alberta has been consolidated
into the Environmental Protection and Enhancement Act, or EPEA, which came into
force on September 1, 1993. The EPEA imposes stricter environmental standards,
requires more stringent compliance, reporting and monitoring obligations and
significantly increases penalties for violations. Westlinks is committed to
meeting its responsibilities to protect the environment wherever it operates and
anticipates making increased expenditures of both a capital and expense nature
as a result of the increasingly stringent laws relating to the protection of the
environment and will be taking such steps as required to ensure compliance with
the EPEA and similar legislation in other jurisdictions in which it operates.
Westlinks believes that it is in material compliance with applicable
environmental laws and regulations. Westlinks also believes that it is
reasonably likely that the trend towards stricter standards in environmental
legislation and regulation will continue.

MANAGEMENT

DIRECTORS AND EXECUTIVE OFFICERS

The directors and executive officers of Westlinks are:

<TABLE>
<CAPTION>
NAME AGE POSITION WITH WESTLINKS
---- --- -----------------------
<S> <C> <C>
Peter R. Sekera 45 Director, President and Chief Executive Officer
Edward C. McFeely 45 Director, Executive Vice-President and Chief Operating
Officer
Thomas J. Jacobsen 65 Director and Vice-Chairman
H.S. (Scobey) Hartley 68 Director
Norman J. MacKenzie 55 Director
Norman W.G. Wallace 62 Director
Lynn W. Thurlow 46 Vice-President, Finance and Chief Financial Officer
Marcia L. Johnston 52 Secretary
</TABLE>

Peter R. Sekera. Mr. Sekera has been our Chief Executive Officer and a
director since Westlinks' amalgamation on June 30, 1998 and was also Chief
Executive Officer and a director of Westlinks' predecessor, Temba Resources
Ltd., from its incorporation in July, 1996. During that time he has also held
the offices of either Chairman or President, and has been President since
October, 1999. Prior to joining Westlinks, Mr. Sekera was a financial consultant
to the oil industry from July, 1994 through June, 1996, and served as Manager,
Planning and Development, of Wascana Energy Inc. from September, 1991 to July,
1994, and the Manager of Corporate Finance at the Toronto-Dominion Bank from
September, 1981 to September, 1991. He earned a Bachelor of Science degree from
the University of Waterloo in 1976, and received his certification under the
Directors and Officers section of the Canadian Securities Institute. His 24
years of experience in the Canadian oil and gas industry encompasses oil and gas
reserve evaluation and financial planning.

Edward C. McFeely. Mr. McFeely has been a director of Westlinks since its
amalgamation in June, 1998. He served as Vice-President, Engineering from
October, 1998 to May, 1999 and as Executive Vice-President of Engineering from
October, 1999 to October, 2000. He is currently our Executive Vice-President and
Chief Operating Officer. Mr. McFeely was an independent engineering consultant
from July, 1996 to October, 1998, and his previous experience includes President
and CEO of Prize Energy Inc. from December, 1993 to June, 1996. He received a
Bachelor of Science degree in Petroleum Engineering from the University of
Alberta in 1980 and is a Professional Engineer with a membership in the
Association of Professional Engineers, Geologists and Geophysicists of Alberta.

Thomas J. Jacobsen. Mr. Jacobsen joined Westlinks as a director in
February, 1999, and was appointed Executive Vice-President of Operations in
October, 1999. In October, 2000 he resigned from this position and

33
<PAGE> 36

was appointed the Vice-Chairman of the Board of Directors. He was also appointed
President of a U.S. subsidiary to be created, Westlinks Inc. As President of
Westlinks Inc., Mr. Jacobsen will review oil and gas opportunities in the United
States. Through his company, Wells Gray Resort & Resources Ltd., Westlinks has
also granted him a consulting contract through April 15, 2001; pursuant to which
Mr. Jacobsen will be in charge of Westlinks' drilling, completion and equipping
projects. His more than 40 years of experience in the oil and gas industry in
Alberta and Saskatchewan includes serving as the President and CEO of Niaski
Environmental Inc. from November, 1996 to February, 1999; President and CEO of
International Pedco Energy Corporation from September, 1993 to February, 1996,
and President of International Colin Energy Corporation from October, 1987 to
June, 1993. Mr. Jacobsen currently serves as a director of Niaski Environmental
Inc., a company listed on the Canadian Venture Exchange. Niaski has made a
proposal to its creditors under the Bankruptcy and Insolvency Act (Canada). The
proposal has been approved by the creditors but has not yet been funded and
completed.

H.S. (Scobey) Hartley. Mr. Hartley was appointed a director of Westlinks
in May, 2000. He has been Chairman of Prism Petroleum Ltd. since January, 1997
and was formerly the President of Prism Petroleum Ltd. and a predecessor company
from December, 1990 through December, 1996. Mr. Hartley has also served as the
President of Faster Oilfield Services since June, 1995, and was the President of
Cayenne Energy Corp. from 1990 through 1996. He received a Bachelor of Science
degree in Geology from Texas Tech University in 1956.

Norman J. Mackenzie. Mr. Mackenzie was elected a director of Westlinks in
May, 2000. He has been Chairman of Raptor Capital Corporation since January,
1998 and was the President from December, 1996 until January, 1998. He has also
been President of Normac Investments Inc. since 1989. Mr. Mackenzie has over 25
years experience in the domestic and international energy industry, including
President of Sunningdale Oil (Abu Dhabi) Ltd.; President of Scarboro Resources
Limited; Chairman of Braco Resources Ltd., and Co-Chairman of Scimitar
Hydrocarbons Corp. He received a Bachelor of Arts degree in Politics and Law
from the University of Cape Town in 1992.

Norman W.G. Wallace. Mr. Wallace was elected a director of Westlinks in
May, 2000. He has been the owner of Wallace Construction Specialties Ltd. since
1972. Mr. Wallace received a Bachelor of Commerce degree from the University of
Saskatchewan in 1968.

Lynn W. Thurlow. Mr. Thurlow joined Westlinks as Vice-President, Finance
and Chief Financial Officer in November, 1999, after being retained as a
financial consultant to Westlinks in October, 1999. Previously he served as
Vice-President, Finance and CFO of Telebackup Systems Inc. from March, 1996 to
June, 1999; Vice-President, Finance and CFO of International Pedco Energy
Corporation from 1993 to February, 1996, and Controller of International Colin
Energy Corporation from 1990 to 1993. Mr. Thurlow received a Bachelor of
Commerce degree from the University of Alberta in 1979. He articled with Coopers
and Lybrand Chartered Accountants and obtained his Chartered Accountant
designation in 1983.

Marcia L. Johnston. Ms. Johnston was appointed Secretary of Westlinks in
September, 1999 and has served as our corporate counsel since February, 1999.
She has been a partner in the Calgary office of the national Canadian law firm
of Gowling Lafleur Henderson LLP since April 2000 and previously was a partner
of Johnston Robinson Clark Anderson and predecessor firms since 1986. She was
admitted to the practice of law in the Province of Alberta in 1985 and in the
State of Kansas in 1974. She earned a Bachelor of Arts degree in 1971 and Juris
Doctor degree in 1973 from Washburn University. Ms. Johnston is also Secretary
of Niaski Environmental Inc., a company listed on the Canadian Venture Exchange.
Niaski Environmental Inc. has made a proposal to its creditors under the
Bankruptcy and Insolvency Act (Canada). The proposal has been approved by the
creditors but has not yet been funded and completed.

BOARD OF DIRECTORS

Westlinks is authorized to have a board of at least three directors and no
more than ten. We currently have six directors. Our directors are elected for a
term of about one year, from annual meeting to annual meeting, or until an
earlier resignation, death or removal. Each officer serves at the discretion of
the board or until an earlier resignation or death. There are no family
relationships among any of our directors or officers.
34
<PAGE> 37

Alberta corporate law requires that we have at least two independent outside
directors who are not officers or employees of Westlinks.

Currently our directors do not receive any fees or remuneration for being
directors of Westlinks, but we will reimburse actual and reasonable out of
pocket expenses incurred for attending board and committee meetings. Directors
are eligible to receive stock options granted by our board.

COMMITTEES OF THE BOARD OF DIRECTORS

Westlinks' Board of Directors currently has an audit committee, a
compensation committee and an environmental and safety committee.

Audit Committee. Our audit committee consists of Mr. MacKenzie, Mr.
Hartley and Mr. Sekera, two of whom are independent. The audit committee reviews
in detail and recommends approval of the full board of our annual and quarterly
financial statements; recommends approval of the remuneration of our auditors to
the full board; reviews the scope of the audit procedures and the final audit
report with the auditors, and reviews our overall accounting practices and
procedures and internal controls with the auditors.

Compensation Committee. Our compensation committee consists of Mr.
Hartley, Mr. Wallace and Mr. Sekera. The compensation committee recommends
approval to the full board of the compensation of the Chief Executive Officer,
the annual compensation budget for all other employees, bonuses, grants of stock
options and any changes to our benefit plans.

Environmental and Safety Committee. Our environmental and safety committee
consists of Mr. Wallace, Mr. MacKenzie and Mr. McFeely. The environmental and
safety committee determines the scope and frequency of periodic reports to the
board concerning environmental and safety issues in our operations.

EXECUTIVE COMPENSATION

The following table sets forth the remuneration of our Chief Executive
Officer for the years indicated. All monetary amounts are in Canadian dollars.

COMPENSATION SUMMARY

LONG-TERM COMPENSATION
AWARDS PAYOUTS
SECURITIES
UNDER RESTRICTED
OPTIONS/ SHARES OR
SARS RESTRICTED LTIP ALL OTHER
NAME AND PRINCIPAL SALARY BONUS GRANTED SHARE PAYOUTS COMPENSATION
POSITION ($) ($) SEVERANCE (#)(1) UNITS (%) ($) ($)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Peter R. Sekera...... 1999 $74,000 $50,000 -- 100,000 0% $nil $732
Chairman (now 1998 $72,000 -- -- 80,000 0% $nil $732
President) and CEO 1997 $18,000 $50,000 -- 35,000 0% $nil --
Thomas S. Bamford.... 1999 $60,000 -- $72,787 -- 0% $nil $460
President 1998 $76,000 $10,000 -- 77,000 0% $nil $460
1997 $18,000 $50,000 -- 35,000 0% $nil --
</TABLE>

Note:

(1)In 1998, Mr. Sekera and Mr. Bamford had also been granted options in our
predecessor, Temba Resources Ltd., which were cancelled on the amalgamation.

35
<PAGE> 38

Management Contracts

Westlinks has no management or employment contracts with its officers.
Westlinks has entered into a consulting agreement with Wells Gray Resort &
Resources Ltd. through April 15, 2001; under which Thomas J. Jacobsen will be in
charge of Westlinks' drilling, completion and equipping projects, for consulting
fees of $8,333 per month.

Stock Options

Westlinks grants stock options from time to time to its directors,
officers, key employees, and consultants. The terms and conditions of the
options, in accordance with resolutions of our board of directors and the
policies of the Canadian Venture Exchange, will not exceed a term of five years.
The option price may be at a discount to market price, which discount will not,
in any event, exceed that permitted by any stock exchange on which our shares
are listed for trading.

Ten percent of Westlinks shares of issued and outstanding common stock from
time to time are reserved for issuance pursuant to stock options. The aggregate
number of shares reserved for issuance under option grants, together with any
other employee stock option plans, options for services and employee stock
purchase plans, will not exceed ten percent of the issued and outstanding shares
of common stock. In addition, the aggregate number of shares so reserved for
issuance to any one person shall not exceed five percent of the issued and
outstanding shares of common stock.

If an optionee ceases to be eligible due to the loss of corporate office or
employment for any reason other than death, the option terminates not later than
90 days after the loss of such corporate office; provided that in the event of
termination of employment for cause, the board of directors may resolve that the
option shall terminate on the date of such termination. Option agreements also
provide that estates of deceased participants can exercise their options for a
period not exceeding one year following death.

Stock Options Granted During the Most Recently Completed Financial Year

The following table discloses the grants of options to purchase or acquire
shares of common stock to our executive officers during the fiscal year ended
December 31, 1999. All monetary amounts are in Canadian dollars.

OPTION GRANTS DURING FISCAL YEAR ENDED DECEMBER 31, 1999

NUMBER
OF % OF TOTAL
SECURITIES OPTIONS UNEXERCISED
UNDER GRANTED TO OPTIONS AT
OPTIONS EMPLOYEES IN EXERCISE DECEMBER 31,
GRANTED FY ENDED PRICE 1999 EXPIRATION
NAME (#) DEC. 31, 1999 ($/SHARE) (#) DATE
<S> <C> <C> <C> <C> <C>
Peter R. Sekera............ 100,000 38.4% $1.00 100,000 November 1, 2004
Edward C. McFeely.......... 80,000 30.8% $1.00 80,000 November 1, 2004
Thomas J. Jacobsen......... 80,000 30.8% $1.00 80,000 November 1, 2004
</TABLE>

A total of 260,000 options were granted to employees by Westlinks during
the fiscal year ended December 31, 1999.

36
<PAGE> 39

Aggregated Option Exercises During the Most Recently Completed Financial Year
and Financial Year End Option Values

The following table sets forth the aggregate of options exercised by our
executive officers during the year ended December 31, 1999 and the financial
1999 year-end values for options granted to the executive officers. All monetary
amounts are in Canadian dollars.

VALUE OF
UNEXERCISED
IN-THE-MONEY OPTIONS
UNEXERCISED AT FY-END
OPTIONS AT FY-END EXERCISABLE/
SECURITIES AGGREGATE VALUE EXERCISABLE/ UNEXERCISABLE ($)
NAME EXERCISED (#) REALIZED ($) UNEXERCISABLE (#) (1)
<S> <C> <C> <C> <C>
Peter R. Sekera.............. 80,000 $32,000 100,000 $0/0
Edward C. McFeely............ 20,000 $ 8,000 80,000 $0/0
Thomas J. Jacobson........... -- -- 80,000 $0/0
Thomas S. Bamford............ 77,000 $30,800 -- --
Cheryl L. McCaughlan......... 20,000 $ 8,000 -- --
</TABLE>

(1) The closing price of our shares of common stock on the Canadian Venture
Exchange on the last trading day in December, 1999 was $1.00.

37
<PAGE> 40

INTEREST OF MANAGEMENT AND OTHERS IN CERTAIN TRANSACTIONS

None of Westlinks' directors or executive officers, nor any person who
beneficially owns directly or indirectly or exercises control or direction over
securities carrying more than 5% of the voting rights attaching to our shares of
common stock, nor any known associate or affiliate of these persons had any
material interest, direct or indirect in any transaction since the January 1,
1997 which has materially affected Westlinks, or in any proposed transaction
which will materially affect Westlinks, except as follows:

ACQUISITION OF 759795 ALBERTA LTD.

In August, 1999, Westlinks acquired 759795 Alberta Ltd. from Wells Gray
Resort & Resources Ltd. for cash consideration of $400,000. Wells Gray Resort &
Resources Ltd. is wholly owned by Thomas J. Jacobsen. At the time of the
acquisition, Mr. Jacobsen was an outside independent director of Westlinks.
759795 Alberta held all of the oil and gas interests and expertise of Wells Gray
Resort & Resources Ltd., including the services of Thomas J. Jacobsen. 759795
Alberta also had the option to acquire any oil and gas acquisition offer made
through Wells Gray Resort & Resources Ltd. At the time of the acquisition by
Westlinks, there were several such outstanding offers, including the accepted
offer for the Bigoray acquisition discussed above.

PRIVATE PLACEMENT

Between September 27 and December 16, 1999 we sold an aggregate of
1,175,000 shares of common stock at $1.00 per share as a private placement to 19
residents of Alberta, Canada. Our directors and officers and their spouses
purchased 665,000 shares of common stock, being 57% of the private placement.

LOANS TO OFFICERS AND DIRECTORS

On February 16, 2000, Westlinks loaned an aggregate of $390,000 to its then
officers and directors to exercise outstanding stock options at $1.00 per share.
The loans were without interest, payable in full on or before December 31, 2000
and secured by the stock purchased with the proceeds. The loans have all been
repaid. The following table sets out the names and positions with Westlinks of
the borrowers, the amount of the loans and the number of shares purchased with
the proceeds.

LOAN AMOUNT FINANCIALLY ASSISTED
NAME AND PRINCIPAL POSITION ($) SECURITIES PURCHASED
<S> <C> <C>
Peter R. Sekera..................................... 100,000 100,000 common shares
President and CEO and Director
Edward C. McFeely................................... 80,000 80,000 common shares
Executive V-P, Engineering and Director
Thomas J. Jacobsen.................................. 80,000 80,000 common shares
Executive V-P, Operations and Director
Dale N. Fisher...................................... 20,000 20,000 common shares
Former Director
Thomas S. Bamford................................... 20,000 20,000 common shares
Former Director
Lynn W. Thurlow..................................... 50,000 50,000 common shares
V-P Finance
Marcia L. Johnston.................................. 40,000 40,000 common shares
Secretary
</TABLE>

38
<PAGE> 41

PRIVATE STOCK OPTIONS

John P. McGrain, holder of over 5% of our outstanding common stock, was
granted options by Westlinks' officers and directors to purchase an aggregate of
500,000 shares of common stock at a price of US $1.50 per share. The options
were granted March 15, 2000 and expire October 31, 2000. For administrative
convenience, the shares underlying the options were transferred by the directors
and officers into a holding company, 855710 Alberta Ltd., which granted the
options to Mr. McGrain. At October 18, 2000, Mr. McGrain had exercised options
to purchase 296,000 shares of common stock, of which he retains 167,300 shares.
Upon successful completion of this offering, Westlinks directors and officers
have verbally agreed to grant Mr. McGrain options to purchase an additional
500,000 shares of common stock, at an exercise price equal to the exercise price
of the warrants issued under this prospectus.

PRIVATE LOAN

On June 5, 2000, Westlinks borrowed US$1,550,000 from six private
investors, including US$925,000 from Patrick Williams Advisors, a partnership,
in which John P. McGrain is a 50% partner. The lenders receive interest at the
rate of 12% per annum. Westlinks also granted the lenders a set-up fee of
US$50,000, of which Patrick Williams Advisors received US$30,833. Westlinks
issued a total of 150,000 warrants to the lenders, including 92,500 warrants to
Patrick Williams Advisors. On October 2, 2000, the loans were repaid in full and
all of the warrants were exercised at the exercise price of US$4.00 per share.

PRIVATE PLACEMENT

During 2000 we purchased 2,500,000 shares of common stock of Raptor Capital
Corporation plus warrants to purchase 1,250,000 Raptor shares at an exercise
price of $0.15 per share, for aggregate consideration of $250,000. Norman J.
Mackenzie, one of our directors, is Chairman of Raptor.

CONSULTING AGREEMENT

Westlinks has entered into a Consulting Agreement at October 13, 2000, with
Wells Gray Resort & Resources Ltd. through April 15, 2000. Under the contract
Thomas J. Jacobson will be in charge of Westlinks' drilling, completion and
equipping projects, for consulting fees of $8,333 per month.

39
<PAGE> 42

PRINCIPAL STOCKHOLDERS

The following table sets forth information regarding beneficial ownership
of our common stock as of October 19, 2000, by:

- each person who is known by Westlinks to beneficially own more than 5%
of our outstanding common stock;

- each of our executive officers and directors; and

- all executive officers and directors as a group.

Shares of common stock not outstanding but deemed beneficially owned
because an individual has the right to acquire the shares of common stock within
60 days are treated as outstanding when determining the amount and percentage of
common stock owned by that individual and by all directors and executive
officers as a group.

<TABLE>
<CAPTION>
PERCENTAGE OF
NUMBER OF SHARES OUTSTANDING
SHARES --------------------
BENEFICIALLY BEFORE AFTER
OWNED OFFERING OFFERING
------------ -------- --------
<S> <C> <C> <C>
Peter R. Sekera(1)(2)....................................... 672,100 14.34 11.82
Edward C. McFeely(1)(2)..................................... 758,680 16.25 13.39
Thomas J. Jacobsen(1)(2).................................... 435,000 9.32 7.68
H.S. (Scobey) Hartley(1)(2)................................. 21,500 0.47 0.38
Norman J. Mackenzie(1)(2)................................... 20,000 0.43 0.36
Norman W.G. Wallace(1)(2)................................... 20,000 0.43 0.36
Lynn W. Thurlow(1)(2)....................................... 60,000 1.30 1.07
Marcia L. Johnston(1)(2).................................... 18,000 0.39 0.32
All directors and executive officers as a group (eight
persons).................................................. 2,005,280 40.57 33.74
John P. McGrain(1)(3)(4).................................... 463,800 9.69 8.02
Thomas S. Bamford(1)........................................ 347,300 7.58 6.22
</TABLE>

---------------

Notes:

(1) The address of each officer and director is Suite 700, 703 - 6th Avenue
S.W., Calgary, Alberta, Canada T2P 0T9. The address of Mr. McGrain is 1000
East Cordova, Pasadena, California 91106. The address of Mr. Bamford is
#907, 727 - 6th Avenue S.W., Calgary, Alberta T2P 0V1.

(2) In the foregoing table, the common stock beneficially owned by:

- Mr. Sekera includes stock options to purchase 105,000 common shares at an
exercise price of $6.15.

- Mr. McFeely includes stock options to purchase 85,000 common shares at
an exercise price of $6.15, 102,500 shares held by his wife and 100,000
shares held by Cormorant Resources Ltd.

- Mr. Jacobsen includes stock options to purchase 85,000 common shares at
an exercise price of $6.15, 60,000 shares held by his wife and children,
as to which he disclaims beneficial ownership or control, and the
balance of 290,000 shares are held by Wells Gray Resort & Resources Ltd.

- Mr. Hartley includes stock options to purchase 20,000 common shares at an
exercise price of $6.15.

- Mr. Mackenzie consists of stock options to purchase 20,000 common shares
at an exercise price of $6.15.

- Mr. Wallace consists of stock options to purchase 20,000 common shares at
an exercise price of $6.15.

- Mr. Thurlow includes stock options to purchase 25,000 common shares at
an exercise price of $6.15, 10,000 shares held by his wife, as to which
he disclaims beneficial ownership or control.

- Ms. Johnston consists of 18,000 shares held by her husband, as to which
she disclaims beneficial ownership or control.

40
<PAGE> 43

(3)In the foregoing table, the common stock beneficially owned by Mr. McGrain
includes 70,000 shares held by Patrick Williams Advisors, of which Mr.
McGrain is a 50% partner, and outstanding options to purchase 204,000 shares
from 855710 Alberta Ltd. through October 31, 2000, at an exercise price per
share of US$1.50.

(4) The directors and officers have verbally agreed upon successful completion
at this offering to privately grant Mr. McGrain options to purchase from
them an additional 500,000 shares of common stock at an exercise price equal
to the exercise price of the warrants issued in the offering.

DESCRIPTION OF SECURITIES

The authorized capital stock of Westlinks consists of an unlimited number
of shares of common stock and an unlimited number of shares of preferred stock
without nominal or par value. The preferred stock may be issued in one or more
series as determined by the board of directors.

COMMON STOCK

Each holder of record of common stock is entitled to one vote for each
share held on all matters properly submitted to the stockholders for their vote,
except matters which are required to be voted on as a particular class or series
of stock. Cumulative voting for directors is not permitted.

Holders of outstanding shares of common stock are entitled to those
dividends declared by the board of directors out of legally available funds. In
the event of liquidation, dissolution or winding up of the affairs of Westlinks,
holders of common stock are entitled to receive, pro rata, the net assets of
Westlinks available after provision has been made for the preferential rights of
the holders of preferred stock. Holders of outstanding common stock have no
preemptive, conversion or redemption rights. All of the issued and outstanding
shares of common stock are, and all unissued shares of common stock, when
offered and sold will be, duly authorized, validly issued, fully paid and
non-assessable. To the extent that additional shares of common stock may be
issued in the future, the relative interests of the then existing stockholders
may be diluted.

NORMAL COURSE ISSUER BID

In December, 1999, Westlinks filed a notice to purchase up to 195,782 of
its shares of common stock through the facilities of the Canadian Venture
Exchange and in accordance with the by-laws and rules of the Canadian Venture
Exchange on or before December 16, 2000. Through October 18, 2000, no shares
were purchased by Westlinks and no shares will be purchased until at least 90
days after the effective date of this prospectus. No proceeds from this offering
will be used to purchase shares.

PREFERRED STOCK

Our board of directors is authorized to issue from time to time, without
stockholder authorization, in one or more designated series, unissued shares of
preferred stock with such dividends, redemption, conversion and exchange
provisions as may be provided by the board of directors with regard to such
particular series. Any series of preferred stock may possess voting, dividend,
liquidation and redemption rights superior to those of the common stock.

The rights of the holders of common stock will be subject to and may be
adversely affected by the rights of the holders of any preferred stock that we
may issue in the future. Our issuance of a new series of preferred stock could
make it more difficult for a third party to acquire, or discourage a third party
from acquiring, the outstanding shares of common stock of Westlinks and make
removal of the board of directors more difficult. No shares of preferred stock
are currently issued and outstanding and Westlinks has no current plans to issue
any shares of preferred stock.

41
<PAGE> 44

WARRANTS

Each of the 1,000,000 warrants being offered hereunder entitles the holder
to purchase one share of common stock at an exercise price of US$ -- for a
period of six months from the date of this prospectus. The warrants will be
issued under the terms of a warrant trust indenture between Westlinks and
Montreal Trust Company of Canada, as trustee for the warrant holders. Westlinks
has authorized and reserved for issuance the shares of common stock issuable on
exercise of the warrants. If the underwriter's over-allotment option relating to
the warrants is exercised, up to an additional 150,000 warrants may be issued.

The warrant exercise price and the number of shares of common stock that
may be purchased upon exercise of the warrants are subject to adjustment in the
event of:

- a stock dividend on the common stock;

- a subdivision of the common stock;

- a split of the common stock;

- a reorganization of the common stock; or

- a merger of Westlinks with or into another corporation.

- a sale of common stock at a price which is discounted greater than 10% to
the market price at the time the company approves the sale.

We may obtain gross proceeds of up to US$5,250,000 from exercise of
warrants, or US$6,037,500 if the over-allotment option is exercised. The net
proceeds from any exercise of the warrants will be added to our general working
capital. Our management will have broad discretion in the application of the
proceeds and you will not have the opportunity, as part of your investment
decision, to assess whether the proceeds are being used appropriately.

Westlinks must have on file a current registration statement with the SEC
pertaining to the common stock underlying the warrants for a holder to exercise
the warrants. In the absence of an exemption, shares of common stock underlying
the warrants must also be registered or qualified for sale under the securities
laws of the states in which the warrant holders reside. We intend to use our
best efforts to keep the registration statement incorporating this prospectus
current. If the registration statement covering the underlying common stock is
not kept current, or if the common stock underlying the warrants is not
registered or qualified for sale in the state in which a warrantholder resides,
the warrants may not be exercised.

The warrants do not confer upon the warrant holder any voting or other
rights of a stockholder of Westlinks.

SHARES ELIGIBLE FOR FUTURE SALE

Future sales of substantial amounts of our common stock in the public
market, in either Canada or the United States, or even the perception that such
sales could occur, could adversely affect the market price for our common stock
and could impair our future ability to raise capital through an offering of our
equity securities.

Upon completion of this offering, we will have outstanding an aggregate of
5,582,639 shares of common stock, assuming no exercise of the underwriters'
over-allotment option and no exercise of outstanding options. Of these shares,
the 1,000,000 shares sold in this offering and the 150,000 shares registered for
resale simultaneously will be freely tradeable, in Canada, without restrictions
imposed by applicable securities laws.

All of our officers, directors and holders of more than 10% of our
outstanding common stock have agreed not to sell, transfer, offer or otherwise
dispose of, directly or indirectly, any of their shares for a period of six
months after the date of this prospectus, except with consent of the
underwriters. Subject to this agreement,

42
<PAGE> 45

the 532,000 shares of our common stock outstanding on the date of this
prospectus will be come freely tradeable in Canada on the dates indicated:

- 317,000 shares on October 20, 2000;

- 125,000 shares on October 26, 2000;

- 50,000 shares on December 16, 2000; and

- 40,000 shares on January 20, 2001.

In addition, the 1,000,000 shares of common stock issuable upon the
exercise of the warrants offered by this prospectus, which are immediately
exercisable, may be resold in the United States and Canada by persons other than
our affiliates immediately upon issuance. The 200,000 shares of common stock
issuable at any time between one and four years from the date of this prospectus
upon the exercise of the underwriters' option will also be eligible for
immediate resale in Canada, and in the United States by persons who are not
affiliates of Westlinks.

We intend to register the shares of our common stock issuable pursuant to
our stock option plan shortly after the effective date of this offering. There
are currently outstanding under the plan options to purchase 443,000 shares, all
of which would be eligible for immediate resale in Canada, and in the United
States by persons who are not affiliates of Westlinks.

Our affiliates may reoffer and resell shares of our common stock in Canada,
in accordance with the foregoing, provided that such shares are offered and sold
by them pursuant to Rule 903 of Regulation S under the Securities Act and that
at the time the CDNX continues to be the principal market for our common stock.

LEGAL PROCEEDINGS

There is no material litigation pending against Westlinks.

UNDERWRITING

Subject to the terms and conditions of the underwriting agreement, Prima
Terra Capital, Division of Merit Capital Associates Inc., and Spencer Edwards,
Inc. have agreed to purchase 1,000,000 shares of common stock and 1,000,000
warrants from Westlinks. The underwriters will purchase these securities at the
price to public less underwriting discounts set forth on the cover page of this
prospectus.

If any shares and warrants are purchased, the underwriters are committed to
purchase all of the 1,000,000 shares and 1,000,000 warrants offered by this
prospectus, but not the 150,000 shares and 150,000 warrants subject to the
over-allotment option.

The underwriters of this offering named below, for whom Merit Capital
Associates, Inc. and Spencer Edwards, Inc. are acting as representatives, have
severally agreed with us, subject to the terms and conditions of the
underwriting agreement, to purchase from us the aggregate number of shares of
common stock and warrants set forth opposite their respective names below.

<TABLE>
<CAPTION>
NUMBER OF
SHARES AND
UNDERWRITER WARRANTS
----------- -----------
<S> <C>
Merit Capital Associates, Inc............................... $ --
Spencer Edwards, Inc........................................ --
-----------
Total.................................................. --
===========
</TABLE>

The underwriting agreement provides that the obligations of the
underwriters are subject to approval of certain legal matters by counsel and to
various other conditions. We have agreed to indemnify the several underwriters
against certain liabilities, including liabilities under the Securities Act, and
where such

43
<PAGE> 46

indemnification is unavailable, to contribute to payments that the underwriters
may be required to make in respect of such liabilities. The nature of the
underwriters' obligations is that they are committed to purchase and pay for all
of the above shares of common stock if any are purchased.

Once the underwriters have purchased the shares and warrants at the public
offering price of US$ -- per share and US$0. -- per warrant less the 10%
underwriting discount, it will offer the shares and warrants in units consisting
of one share and one warrant at the public offering prices and to other
broker-dealers who are members of the selling group at that price minus a
concession of US$0. -- per share and US$0. -- per warrant. The underwriter
and selling group members may allow a discount of US$0. -- per share and
US$0. -- per warrant on sales to other broker-dealers. After the public
offering of the shares and warrants, the public offering price, the concession
to selling group members and the discount to other broker-dealers may be changed
by the underwriters.

Westlinks has granted the underwriter an option, until 45 days after the
date of this prospectus, to purchase up to 150,000 additional shares and 150,000
warrants on the same terms as apply to the sale of the shares and warrants set
forth above. The underwriters may exercise the option solely to cover
over-allotments incurred in the sale of the shares and warrants.

The underwriters have informed us that they do not expect to sell any of
the shares or warrants to accounts over which they have discretionary authority.
All investors must purchase an equal number of shares and warrants.

The following table summarizes the discounts and estimated expenses that we
will pay to the underwriters, expressed in U.S. dollars:

<TABLE>
<CAPTION>
TOTAL
--------------------------------
PER PER WITH WITHOUT
SHARE WARRANT OVER-ALLOTMENT OVER-ALLOTMENT
----- ------- -------------- --------------
<S> <C> <C> <C> <C>
Public offering price......................... $5.00 $ 0.25 $6,037,500 $5,250,000
Underwriting discounts and commissions........ $0.50 $ 0.025 $ 603,750 $ 525,000
Non-accountable expense allowance (3% of the
offering price)............................. $0.15 $0.0075 $ 181,125 $ 157,500
Proceeds, before expenses, to Westlinks....... $4.35 $0.2175 $5,252,625 $4,567,500
</TABLE>

The expenses of the Offering, not including the underwriting discounts and
commissions and non-accountable expense allowance, are estimated at US$272,500
and are payable by Westlinks.

The public offering price will be negotiated between the underwriters and
us and will be based on the closing price of our common shares on the Canadian
Venture Exchange and in the National Quotation Bureau's pink sheets on the date
of the announcement of the offering price. Demand for our shares of common
stock, estimates of our business potential and cash flow and earnings prospects,
current production levels and other factors that may affect our value will be
considered in determining the offering price.

We have also agreed to issue to the underwriters warrants to purchase up to
200,000 shares at an exercise price of US$ -- per share. The underwriter's
warrants may not be exercised for one year but may be exercised for a four year
period thereafter. The warrants will be restricted from sale, transfer,
assignment or hypothecation, except to officers or partners (not directors) of
the underwriter and members of the selling group and/or their officers or
partners. The underwriters' warrants are not redeemable by us. We have agreed to
maintain an effective registration statement with respect to the issuance of the
securities underlying the underwriters' warrants, if necessary, to allow their
public resale without restriction, at all times during the period in which the
underwriters' warrants are exercisable, beginning one year after the date of
this prospectus. Such securities are being registered in the registration
statement of which this prospectus is a part.

The underwriting agreement provides for indemnification between us and the
underwriters against liabilities under the Securities Act of 1933 and for
contribution by us and the underwriters to payments that may be required to be
made in respect of those liabilities. Insofar as indemnification for liabilities
under the Securities Act may be permitted to our directors, officers and
controlling persons under the agreement

44
<PAGE> 47

between us and the underwriters, or otherwise, we have been advised that in the
opinion of the SEC this indemnification is against public policy as expressed in
the Securities Act and is, therefore, unenforceable in the United States.

Our officers and directors, aggregating 1,987,280 shares and/or options,
have agreed that for a period of six months following the date of this
prospectus, they will not offer, sell, contract to sell, grant any option for
the sale or otherwise dispose of any of our common stock other than intra-family
transfers or transfers to trusts for estate planning purposes, without the
consent of the underwriter with respect to 1,537,280 of these shares.

The underwriters may engage in over-allotment, stabilizing transactions and
syndicate covering transactions and penalty bids in accordance with Regulation M
under the Securities Exchange Act of 1934.

- Over-allotment involves syndicate sales in excess of the offering size,
which create a syndicate short position.

- Stabilizing transactions permit bids to purchase the underlying security
so long as the stabilizing bids do not exceed a specified maximum.

- Syndicate covering transactions involve purchases of the common stock
and warrants in the open market after the distribution has been
completed in order to cover syndicate short positions.

- Penalty bids permit the underwriter to reclaim a selling concession from
a syndicate member when the shares and warrants originally sold the
syndicate member are purchased in a syndicate covering transaction to
cover syndicate short positions.

These stabilizing transactions, syndicate covering transactions and penalty
bids may cause the price of the common stock or warrants to be higher than they
would otherwise be in the absence of these transactions. These transactions, if
commenced, may be discontinued at any time. These transactions may not be sold
to accounts over which the underwriters have discretion.

EFFECT OF CANADIAN TAX LAWS ON UNITED STATES STOCKHOLDERS

In the opinion of Gowling Lafleur Henderson LLP ("Counsel") counsel to
Westlinks, the following is a summary of certain Canadian federal income tax
considerations generally applicable to a person who acquires shares of common
stock and warrants pursuant to this prospectus and who, for the purposes of the
Income Tax Act (Canada), or the Tax Act, is not resident in Canada at any time
while holding common stock or warrants to acquire common stock of Westlinks,
does not carry on an insurance business in Canada, holds the common stock and
warrants as capital property and who does not use or hold and is not deemed
under the Tax Act to use or hold the common stock and warrants in or in the
course of carrying on a business in Canada.

This summary is based upon the current provisions of the Tax Act, the
regulations thereunder, all proposed amendments thereto publicly released by the
Department of Finance prior to the date hereof ("Proposed Amendments") and
Counsel's understanding of the current published administrative and assessing
practices of the Canada Customs and Revenue Agency. This summary does not take
into account tax legislation or considerations of any province or territory of
Canada or any jurisdiction other than Canada and, except for the Proposed
Amendments, this summary does not take into account or anticipate any changes in
law or administrative or assessing practices, whether by legislative,
governmental or judicial action.

THIS SUMMARY IS OF A GENERAL NATURE ONLY AND IS NOT INTENDED TO BE SPECIFIC
LEGAL OR TAX ADVICE TO ANY PARTICULAR PERSON. STOCKHOLDERS SHOULD THEREFORE
CONSULT THEIR OWN TAX ADVISORS TO DETERMINE THE CANADIAN TAX CONSEQUENCES TO
THEM OF ACQUIRING, HOLDING AND DISPOSING OF SHARES OF COMMON STOCK AND WARRANTS.

U.S. stockholders will only be subject to Canadian tax in respect of the
disposition of their common stock (other than on a disposition to Westlinks) or
their warrants of Westlinks to the extent such shares or warrants constitute
"taxable Canadian property" (as defined in the Tax Act) to the stockholder.
Generally speaking, the common stock and warrants to acquire common stock of
Westlinks will be taxable Canadian property to a holder if (i) the common stock
of Westlinks is not listed on a prescribed stock exchange under the Tax Act
(both the Canadian Venture Exchange and the Nasdaq are proposed to be listed as
prescribed stock
45
<PAGE> 48

exchanges for this purpose) or (ii) the common stock of Westlinks is listed on a
prescribed stock exchange and at any time during the five year period
immediately preceding the disposition the stockholder, either alone or together
with persons with whom the stockholder did not deal at arm's length, owned (or
had rights, warrants or options to acquire) 25% or more of the issued shares of
any class or series in the capital stock of Westlinks. Stockholders whose common
stock or warrants to acquire common stock of Westlinks constitute taxable
Canadian property will be liable to pay tax under the Tax Act on three-quarters
(one-half, pursuant to the Proposed Amendments) of the amount of any capital
gain realized on a disposition of the common stock or warrants.

No Canadian tax, including on capital gains, will be payable in respect of
the exercise of the warrants.

Dividends paid, credited or deemed to have been paid to credited under the
Tax Act on the common stock of Westlinks to U.S. stockholders will be subject to
Canadian withholding tax at a rate of 25% of the gross amount of such dividend.
Under the Canada-United States Income Tax Convention, the rate of withholding
tax on dividends generally applicable to U.S. stockholders who beneficially own
the dividends is reduced to 15%. In the case of U.S. stockholders that are
corporations that beneficially own at least 10% of the voting stock of
Westlinks, the rate of withholding tax on dividends is reduced to 5%.

Canada does not impose any estate taxes or succession duties. However, on
death, there will generally be a deemed disposition under the Tax Act of any
common stock or warrants of Westlinks held at that time for proceeds of
disposition equal to the fair market value of such securities immediately before
the death. Capital gains, if any, realized on the deemed disposition will have
the income tax consequences described above.

LEGAL MATTERS

The validity of the securities offered hereby will be passed on for
Westlinks by Gowling Lafleur Henderson LLP of Calgary, Alberta. Members of
Gowling Lafleur Henderson LLP own 18,480 shares of common stock of Westlinks.
Legal matters in connection with this offering will be passed on for Prima Terra
Capital, Division of Merit Capital Associates, Inc., by Reed Smith LLP of
Newark, New Jersey, and for Spencer Edwards, Inc. by the Law Office of Gary A.
Agron of Englewood, Colorado.

EXPERTS

Collins Barrow, Chartered Accountants, of Calgary, Alberta are the auditors
of Westlinks, and have audited the consolidated financial statements of
Westlinks for the years ending December 31, 1997, 1998 and 1999, as set forth in
their report, which is included in this prospectus. These annual consolidated
financial statements are included in this prospectus in reliance on their
report, given on their authority as experts in accounting and auditing.

Grant Trimble Engineering Ltd., independent engineers of Calgary, Alberta
have given Westlinks a report on our established oil and gas reserves and the
present worth thereof, which report is summarized in this prospectus.

WHERE YOU CAN FIND ADDITIONAL INFORMATION

Westlinks has filed with the Securities and Exchange Commission ("SEC"),
450 Fifth Street N.W., Washington, D.C. 20549, a registration statement on Form
F-1 under the Securities Act with respect to the securities offered. As
permitted by SEC rules, this prospectus does not contain all of the information
set forth in the registration statement. For further information concerning
Westlinks and the securities offered, we refer you to the registration statement
and the exhibits and schedules filed as a part of the registration statement.

Statements contained in this prospectus concerning the contents of any
contract or any other document are not necessarily complete. In each instance
where a copy of that contract or document has been filed as an exhibit to the
registration statement, we refer you to the copy of the contract or document
that has been filed. Each statement is qualified in all respects by reference to
that exhibit. The registration statement, including its

46
<PAGE> 49

exhibits and schedules, may be inspected without charge at the SEC's Public
Reference Room at 450 Fifth Street, N.W., Room 1024 in Washington, D.C. 20549,
and at the SEC's regional offices at Citicorp Center, 500 West Madison Street,
Suite 1400, Chicago, Illinois 60661-2511 and 7 World Trade Center, New York
City, New York 10048. Copies of all or any part of those documents may be
obtained from the SEC's Public Reference Section at 450 Fifth Street NW,
Washington, D.C. 20549 at the SEC's prescribed rates. You may call the SEC at
1-800-SEC-0330 for further information on the operation of the SEC's public
reference rooms. The SEC maintains a Web site at http://www.sec.gov that
contains reports, proxy and information statements and other information
regarding companies that file electronically with the SEC, including Westlinks.

The electronic filing system for public companies in Canada has a Web site
at http://www.sedar.com that contains Westlinks' proxy statements, news
releases, material change reports, financial statements and other information
that public companies in Canada are required to file. In addition, filed
documents and trading information of the shares of common stock of Westlinks may
be found on the Web site of the Canadian Venture Exchange at http://www.cdnx.ca.

We intend to provide our stockholders with annual reports containing
consolidated financial statements audited by an independent chartered accounting
firm and will make available to stockholders quarterly reports containing
unaudited consolidated financial data for the first three quarters of each year.
As a result of this offering we will become subject to the information and
reporting requirements of the Securities and Exchange Act of 1934 and will file
periodic reports, proxy statements and other information with the SEC. However,
we will be exempt from the rules under the Exchange Act prescribing the
furnishing and content of proxy statements, and our officers, directors and
principal stockholders will be exempt from the reporting and short-swing profit
recovery provisions contained in Section 16 of the Exchange Act. Under the
Exchange Act, we are not required to publish financial statements as frequently
or as promptly as U.S. companies. Any information filed with the SEC can be
inspected and copied at the public reference facilities maintained by the SEC at
Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and at the SEC's
following regional offices: Citicorp Center, 500 West Madison Street, Suite
1400, Chicago, Illinois 60661-2511 and 7 World Trade Center, New York City, New
York 10048. Copies of such material can also be obtained from the SEC at
prescribed rates through its Public Reference Section at 450 Fifth Street, N.W.,
Washington, D.C. 20549.

47
<PAGE> 50

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Report of Collins Barrow, Chartered Accountants............. F-2
Consolidated balance sheets as of June 30, 2000 (unaudited)
and December 31, 1999 and 1998............................ F-3
Consolidated statements of income (loss) and retained
earnings for the 6 months ended June 30, 2000 and 1999
(unaudited) and the years ending December 31, 1999, 1998
and 1997.................................................. F-4
Consolidated statements of cash flow for the 6 months ended
June 30, 2000 and 1999 (unaudited) and the years ending
December 31, 1999, 1998 and 1997.......................... F-5
Notes to consolidated financial statements.................. F-6
Supplemental information on oil and gas exploration and
production activities..................................... F-22

INDEX TO PRO-FORMA FINANCIAL STATEMENTS
Compilation Report of Collins Barrow, Chartered
Accountants............................................... F-25
Pro-forma consolidated balance sheet at June 30, 2000....... F-26
Notes to pro-forma consolidated balance sheet............... F-27

INDEX TO SCHEDULE OF REVENUE AND EXPENSES
Report of KPMG LLP, Chartered Accountants................... F-28
Schedule of Revenue and Expenses of the Properties Acquired
from Cabre Exploration Ltd................................ F-29
Notes to Schedule of Revenues and Expenses of the Properties
Acquired from Cabre Exploration Ltd....................... F-30
</TABLE>

F-1
<PAGE> 51

AUDITORS' REPORT

To the Directors
Westlinks Resources Ltd.

We have audited the consolidated balance sheets of Westlinks Resources Ltd.
as at December 31, 1999 and 1998 and the consolidated statements of income
(loss) and retained earnings and cash flow for the years ended December 31, 1999
and 1998 and for the period from commencement of operations, April 1, 1997 to
December 31, 1997. These financial statements are the responsibility of the
company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards in Canada. Those standards require that we plan and perform an audit
to obtain reasonable assurance whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation.

In our opinion, these consolidated financial statements present fairly, in
all material respects, the financial position of the company as at December 31,
1999 and 1998 and the results of its operations and its cash flow for the years
ended December 31, 1999 and 1998 and for the period ended December 31, 1997 in
accordance with generally accepted accounting principles in Canada.

(signed) COLLINS BARROW
Chartered Accountants

Calgary, Alberta
March 31, 2000
(except for notes 7, 15 and 16
which are dated October 24, 2000)

F-2
<PAGE> 52

WESTLINKS RESOURCES LTD.

CONSOLIDATED BALANCE SHEETS

Canadian Dollars

<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31, DECEMBER 31,
2000 1999 1998
----------- ------------ ------------
(RESTATED --
(UNAUDITED) NOTE 10)
<S> <C> <C> <C>
ASSETS
Current assets
Cash and short-term investments.................... $ 1,935 $ 42,288 $ 73,839
Accounts receivable................................ 1,375,007 684,787 231,388
----------- ---------- ----------
1,376,942 727,075 305,227
Capital assets (note 4).............................. 20,393,209 7,016,726 3,622,447
Investments (note 5)................................. 680,000 -- 240,000
Deferred share issuance costs........................ 282,110 -- --
----------- ---------- ----------
$22,732,261 $7,743,801 $4,167,674
=========== ========== ==========
LIABILITIES
Current liabilities
Accounts payable and accrued liabilities........... $ 1,690,720 $ 687,042 $ 222,700
Current portion of long-term debt.................. -- 1,075,000 100,000
Notes payable (note 6)............................. 2,237,100 -- --
----------- ---------- ----------
3,927,820 1,762,042 322,700
Long-term debt (note 7).............................. 11,790,000 1,525,000 700,000
Future income taxes (note 8)......................... 1,151,719 297,793 240,476
Provision for future site restoration................ 207,933 181,332 132,696
----------- ---------- ----------
17,077,472 3,766,167 1,395,872
----------- ---------- ----------
SHAREHOLDERS' EQUITY
Share capital (note 9)............................... 3,902,830 3,663,330 2,407,971
Contributed surplus (note 9[b])...................... 150,500 -- --
Retained earnings.................................... 1,601,459 314,304 363,831
----------- ---------- ----------
5,654,789 3,977,634 2,771,802
----------- ---------- ----------
$22,732,261 $7,743,801 $4,167,674
=========== ========== ==========
</TABLE>

Contingency (note 14)

Approved by the Board,

<TABLE>
<S> <C>
(signed) PETER R. SEKERA (signed) EDWARD C. MCFEELY
Director Director
</TABLE>

F-3
<PAGE> 53

WESTLINKS RESOURCES LTD.

CONSOLIDATED STATEMENTS OF INCOME (LOSS) AND RETAINED EARNINGS

<TABLE>
<CAPTION>
PERIOD FROM
SIX MONTHS ENDED JUNE 30, YEARS ENDED DECEMBER 31, APRIL 1, 1997 TO
-------------------------- ------------------------- DECEMBER 31,
2000 1999 1999 1998 1997
----------- ------------ ---------- ------------ ----------------
(RESTATED --
NOTE 10) (RESTATED -- (RESTATED --
(UNAUDITED) (UNAUDITED) NOTE 10) NOTE 10)
<S> <C> <C> <C> <C> <C>
Revenue
Oil and gas................. $ 6,238,036 $ 824,192 $2,515,456 $1,786,172 $1,196,913
Less: royalties, net of
Alberta Royalty Tax
Credits.................. (1,278,765) (87,325) (442,335) (96,237) (144,555)
Interest.................... -- 69 1,493 7,373 3,006
----------- ---------- ---------- ---------- ----------
4,959,271 736,936 2,074,614 1,697,308 1,055,364
----------- ---------- ---------- ---------- ----------
Expenses
Operating................... 1,321,225 322,155 782,281 849,107 438,594
Exploration................. -- -- 2,655 3,570 35,000
Non-recurring merger
costs.................... -- 145,470 145,470 -- --
General and
administrative........... 517,736 227,237 718,569 426,895 175,965
Interest.................... 229,636 41,361 131,872 185,153 74,128
Depletion and
depreciation............. 1,377,493 289,317 841,580 804,943 352,400
----------- ---------- ---------- ---------- ----------
3,446,090 1,025,540 2,622,427 2,269,668 1,076,087
----------- ---------- ---------- ---------- ----------
Income (loss) before the
following................... 1,513,181 (288,604) (547,813) (572,360) (20,723)
Gain on sale of capital
assets...................... 627,900 39,627 91,402 946,738 280,000
Gain on sale of investments... -- -- 160,000 -- 13,437
----------- ---------- ---------- ---------- ----------
Income (loss) before taxes.... 2,141,081 (248,977) (296,411) 374,378 272,714
Future income taxes (recovery)
(note 8).................... 853,926 (116,145) (246,884) 120,297 57,464
----------- ---------- ---------- ---------- ----------
Net income (loss)............. 1,287,155 (132,832) (49,527) 254,081 215,250
Retained earnings, beginning
of period................... 314,304 363,831 363,831 109,750 --
----------- ---------- ---------- ---------- ----------
1,601,459 230,999 314,304 363,831 215,250
Dividends..................... -- -- -- -- 105,500
----------- ---------- ---------- ---------- ----------
Retained earnings, end of
period...................... $ 1,601,459 $ 230,999 $ 314,304 $ 363,831 $ 109,750
=========== ========== ========== ========== ==========
Net income (loss) per share
(note 9[g])................. $ 0.30 $ (0.05) $ (0.02) $ 0.11 $ 0.16
=========== ========== ========== ========== ==========
Fully diluted income per share
(note 9[g])................. $ 0.27 $ -- $ -- $ 0.11 $ 0.16
=========== ========== ========== ========== ==========
</TABLE>

F-4
<PAGE> 54

WESTLINKS RESOURCES LTD.

CONSOLIDATED STATEMENTS OF CASH FLOW

<TABLE>
<CAPTION>
SIX MONTHS ENDED YEARS ENDED PERIOD FROM
JUNE 30, DECEMBER 31, APRIL 1, 1997 TO
---------------------------- --------------------------- DECEMBER 31,
2000 1999 1999 1998 1997
------------ ------------ ----------- ------------ ----------------
(RESTATED --
NOTE 10) (RESTATED -- (RESTATED --
(UNAUDITED) (UNAUDITED) NOTE 10) NOTE 10)
<S> <C> <C> <C> <C> <C>
Operating activities
Net income (loss)...................... $ 1,287,155 $(132,832) $ (49,527) $ 254,081 $ 215,250
Add (deduct) non-cash items
Depletion and depreciation........... 1,377,493 289,317 841,580 804,943 352,400
Gain on sale of capital assets....... (627,900) (39,627) (91,402) (946,738) (280,000)
Gain on sale of investments.......... -- -- (160,000) -- (13,437)
Future income taxes (recovery)....... 853,926 (116,145) (246,884) 120,297 57,464
------------ --------- ----------- ----------- -----------
Funds provided from operations......... 2,890,674 713 293,767 232,583 331,677
Change in non-cash working capital
balances
(Increase) decrease in accounts
receivable......................... (690,220) (470,714) (453,399) 689,780 (773,718)
Increase (decrease) in accounts
payable and accrued liabilities.... 1,003,678 (68,136) 464,342 (241,144) 341,789
------------ --------- ----------- ----------- -----------
Cash provided from (used in)
operations........................... 3,204,132 (538,137) 304,710 681,219 (100,252)
------------ --------- ----------- ----------- -----------
Financing activities
Agreement payable...................... -- -- -- (3,830,538) 3,830,538
Note payable........................... -- -- -- (500,000) 500,000
Shareholder loan....................... -- -- -- (250,164) 250,164
Due to related company................. -- -- -- (40,139) (188,392)
Deferred share issue costs............. (282,110) -- -- -- --
Long-term debt......................... 9,190,000 450,000 1,800,000 800,000 --
Notes payable.......................... 2,237,100 -- -- -- --
Issuance of common shares, net of
costs................................ 390,000 1,576 1,237,278 (29,524) 906,552
Issuance of warrants................... -- -- -- 500 --
------------ --------- ----------- ----------- -----------
Cash provided from (used in) financing
activities........................... 11,534,990 451,576 3,037,278 (3,849,865) 5,298,862
------------ --------- ----------- ----------- -----------
Investing activities
Proceeds from sale of investments...... -- -- -- -- 35,833
Acquisition of investments............. (250,000) -- -- -- (54,000)
Acquisition of subsidiaries, net of
cash (note 2[a], [c], [d])........... -- -- (400,000) -- (3,931,342)
Cash acquired on amalgamation (note
2[b])................................ -- -- -- 23,563 --
Purchase of capital assets............. (15,117,475) (18,352) (3,768,926) (277,021) (583,509)
Proceeds on disposal of capital
assets............................... 588,000 40,699 796,800 2,027,700 40,000
Due from related parties............... -- -- -- 22,509 (22,509)
Notes receivable....................... -- -- -- 523,697 --
Abandonment costs...................... -- (170) (1,413) (11,792) (295)
------------ --------- ----------- ----------- -----------
Cash provided from (used in) investing
activities........................... (14,779,475) 22,177 (3,373,539) 2,308,656 (4,515,822)
------------ --------- ----------- ----------- -----------
Increase (decrease) in cash.............. (40,353) (64,384) (31,551) (859,990) 682,788
Cash and short-term investments (bank
overdraft), beginning of period........ 42,288 73,839 73,839 933,829 251,041
------------ --------- ----------- ----------- -----------
Cash and short-term investments (bank
overdraft), end of period.............. $ 1,935 $ 9,455 $ 42,288 $ 73,839 $ 933,829
============ ========= =========== =========== ===========
Funds provided from operations per share
(note 9[g])............................ $ 0.67 $ 0.00 $ 0.10 $ 0.10 $ 0.25
============ ========= =========== =========== ===========
Funds provided from fully diluted
operations per share (note 9[g])....... $ 0.59 $ 0.00 $ 0.10 $ 0.10 $ 0.25
============ ========= =========== =========== ===========
Interest paid during the period.......... $ 229,636 $ 41,361 $ 131,872 $ 185,153 $ 74,128
============ ========= =========== =========== ===========
</TABLE>

F-5
<PAGE> 55

WESTLINKS RESOURCES LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(INFORMATION AS AT JUNE 30, 2000 AND FOR THE SIX-MONTH PERIODS
ENDED JUNE 30, 2000 AND JUNE 30, 1999 IS UNAUDITED)

1. COMPANY ACTIVITIES

Westlinks Resources Ltd. ("Westlinks") is a Canadian corporation
incorporated in Alberta, Canada. Westlinks was organized on June 30, 1998
by the amalgamation of Temba Resources Ltd. and PTR Resources Ltd. under
the laws of the province of Alberta, Canada. Their predecessor, Temba
Resources Ltd. ("Temba"), was incorporated in Alberta on July 31, 1996.
Immediately prior to the amalgamation which created Westlinks, Temba
amalgamated with its wholly-owned subsidiary, Rainee Resources Ltd. Their
predecessor, PTR Resources Ltd., was incorporated in Alberta on September
18, 1992 as 542275 Alberta Ltd., changed its name to Ablevest Holdings Ltd.
on January 14, 1993, and to PTR Resources Ltd. on December 1, 1997. The
company currently has a wholly-owned subsidiary, 759795 Alberta Ltd., which
it purchased on August 12, 1999. All activity of the company is conducted
in Canada.

Westlinks' activities are the exploration for and development of oil and
gas properties in Western Canada, primarily in the provinces of Alberta and
Saskatchewan. The company currently has four core areas in Alberta;
Bigoray, Sylvan Lake, Mitsue and Sounding Lake. At June 30, 2000, the
company has working interests in 64 oil wells, producing approximately
1,340 barrels of oil equivalent per day, and holds oil and gas leases on
net acreage of approximately 20,000 acres.

2. BUSINESS COMBINATIONS

(a) Effective August 12, 1999, the company acquired all of the issued and
outstanding shares of 759795 Alberta Ltd. ("759795"), a related party
by virtue of a common director for cash consideration of $400,000. The
transaction has been accounted for using the purchase method of
accounting for a business combination at the exchange amount as there
was a substantive change in ownership and the amount is supported by
independent evidence. The results of operations of 759795 are included
in the consolidated financial statements from the date the company
acquired control, being August 12, 1999.

The purchase price was allocated as follows:

<TABLE>
<S> <C>
Capital assets.............................................. $ 722,282
Future income taxes......................................... (322,282)
---------
$ 400,000
=========
</TABLE>

(b) Effective June 30, 1998, the company was amalgamated with PTR
Resources Ltd. ("PTR"), a related party by virtue of common
shareholders, director and officer. The transaction was accounted for
using the purchase method of accounting for a business combination at
the carrying amount, which approximated fair value. The results of
operations from PTR are included in the consolidated financial
statements from the effective date of the transaction, being June 30,
1998.

F-6
<PAGE> 56
WESTLINKS RESOURCES LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

(INFORMATION AS AT JUNE 30, 2000 AND FOR THE SIX-MONTH PERIODS
ENDED JUNE 30, 2000 AND JUNE 30, 1999 IS UNAUDITED)

The net assets acquired were as follows:

<TABLE>
<S> <C>
Cash........................................................ $ 23,563
Accounts receivable......................................... 132
Future income tax asset..................................... 7,327
Notes receivable............................................ 523,697
Due to related parties...................................... (10,139)
Accounts payable and accrued liabilities.................... (29,541)
Share issuance costs........................................ 19,960
--------
534,999
Less: Investment previously acquired at cost................ (76,104)
--------
$458,895
========
</TABLE>

The consideration for the purchase price was as follows:

<TABLE>
<S> <C>
Shares issued -- 647,837 common (note 9[b])................. $534,999
Shares eliminated on amalgamation (note 9[b], [c]).......... (76,104)
--------
$458,895
========
</TABLE>

(c) Effective September 1, 1997, the company acquired substantially all of
the assets of I.G. Resources Inc. ("I.G.") a company engaged in the
exploration, development and production of oil and gas assets in
Western Canada. The transaction has been accounted for using the
purchase method of accounting for a business combination. The results
of operations from the I.G. assets are included in the consolidated
financial statements from the effective date of the acquisition, being
September 1, 1997.

The assets acquired and consideration given are as follows:

<TABLE>
<S> <C>
Petroleum and natural gas properties and equipment
thereon................................................... $4,032,897
==========
Cash........................................................ $3,932,897
Issuance of 200,000 warrants (note 8[e]).................... 100,000
----------
Total purchase price........................................ $4,032,897
==========
</TABLE>

The income statement of the company for the year ended December 31, 1997
includes interest expense in the amount of $73,068 payable to I.G. as a
result of a difference in the effective versus closing date of the
transaction.

In accordance with the terms of the asset purchase agreement, additional
consideration consisting of 100,000 common share purchase warrants of the
company at a deemed value of $50,000 was provided on June 30, 1998 (note
9[e]).

(d) On December 24, 1997, the company acquired all of the issued and
outstanding shares of Rainee Resources Ltd. ("Rainee") a company
engaged in the exploration, development and production of oil and gas.
The transaction has been accounted for by the purchase method with the
results of Rainee included in the consolidated financial statements
from December 24, 1997.

F-7
<PAGE> 57
WESTLINKS RESOURCES LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

(INFORMATION AS AT JUNE 30, 2000 AND FOR THE SIX-MONTH PERIODS
ENDED JUNE 30, 2000 AND JUNE 30, 1999 IS UNAUDITED)

The net assets acquired were as follows:

<TABLE>
<S> <C>
Cash........................................................ $ 23,315
Non-cash working capital.................................... 86,127
Capital assets.............................................. 616,560
Future income taxes......................................... (55,850)
Due to Temba Resources Ltd.................................. (218,392)
---------
Total purchase price........................................ $ 451,760
=========
</TABLE>

On June 30, 1998, the company amalgamated with Rainee.

The consideration for the purchase price was as follows:

<TABLE>
<S> <C>
1,000,000 common shares..................................... $400,000
Accounts payable and accrued liabilities.................... 30,000
Transaction costs........................................... 21,760
--------
Total purchase price........................................ $451,760
========
</TABLE>

3. SIGNIFICANT ACCOUNTING POLICIES

These financial statements have been prepared using accounting principles
generally accepted in Canada which include:

(a) Principles of consolidation

The consolidated financial statements include the accounts of the
company and its wholly-owned subsidiary, 759795 Alberta Ltd.

(b) Cash and cash equivalents

Cash and cash equivalents consist of balances with banks and short-term
investments with maturities not exceeding 90 days.

The company records its investments for which the company has no
significant influence using the cost method of accounting whereby the
investments are initially recorded at cost. Earnings are recognized only
to the extent received or receivable.

The company uses the equity method to account for its interest in
corporations in which the company owns 50% or less but over which the
company has significant influence. Under this method, the investment is
originally recorded at cost and the carrying value is adjusted
thereafter to include the company's pro-rata share of post acquisition
earnings and losses. Profit distributions are recorded as a reduction to
the amount of the investment.

Where there has been a permanent decline in value, the investment is
stated at estimated net realizable value.

F-8
<PAGE> 58
WESTLINKS RESOURCES LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

(INFORMATION AS AT JUNE 30, 2000 AND FOR THE SIX-MONTH PERIODS
ENDED JUNE 30, 2000 AND JUNE 30, 1999 IS UNAUDITED)

(d) Exploration and development costs

The company follows the successful efforts method of accounting for its
oil and gas exploration and development costs. The initial acquisition
costs of oil and gas properties and the costs of drilling and equipping
development wells and successful exploration wells are capitalized. The
costs of exploration wells classified as unsuccessful are charged to
expense. All other exploration expenditures, including geological and
geophysical costs and annual rentals on exploratory acreage, are charged
to expense as incurred.

Capitalized costs of producing properties and equipment are depleted and
depreciated using the unit of production method based on estimated
proven reserves determined by independent and company engineers. Costs
subject to depletion also include estimated future capital associated
with proven properties. For the purposes of the calculation, natural gas
reserves and production are converted to equivalent volumes of crude oil
based on their approximate relative energy content.

All property and equipment is periodically evaluated throughout the
fiscal year and at year-end. To determine whether there is an impairment
in the carrying amount of the property and equipment, the company
estimates the future cash flows expected to result from the use of the
property or equipment and its eventual disposition less the future cash
outflows expected to be necessary to obtain those inflows. If the sum is
less than the carrying amount of the property or equipment, an
impairment provision is provided for the difference.

(e) Future site restoration costs

Estimated site restoration costs are provided over the life of the
proven reserves on a unit-of-production basis. Costs which include the
cost of production equipment removal and environmental clean up are
estimated each year by management based on current regulations, costs,
technology and industry standards. The annual charge is included in the
provision for depletion and depreciation and the actual restoration
expenditures are charged to the accumulated provision account as
incurred.

(f) Measurement uncertainty

The amounts recorded for depletion and depreciation of exploration and
development costs, the provision for future site restoration, the
impairment evaluation for the properties and equipment and the
impairment test on exploration and development costs are based on
estimated proven reserves, production rates, current oil and natural gas
prices and future costs. By their nature, these estimates are subject to
measurement uncertainty and the effect of changes in such estimates in
future periods could be significant.

(g) Joint venture accounting

Substantially all of the company's exploration and production activities
are conducted jointly with others, and accordingly these financial
statements reflect only the company's proportionate interest in such
activities.

(h) Depreciation

Office equipment and other is depreciated using the declining balance
method at rates ranging from 20% to 30% per annum.

F-9
<PAGE> 59
WESTLINKS RESOURCES LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

(INFORMATION AS AT JUNE 30, 2000 AND FOR THE SIX-MONTH PERIODS
ENDED JUNE 30, 2000 AND JUNE 30, 1999 IS UNAUDITED)

(i) Deferred share issuance costs

Deferred share issuance costs will be charged to share capital as part
of the public offering, as described in note 15, should the offering to
which the costs relate be closed. In the event the offering fails to
close, the costs will be charged to income.

(j) Income taxes

Income taxes are accounted for using the liability method of income tax
allocation. Under the liability method, income tax assets and
liabilities are recorded to recognize future income tax inflows and
outflows arising from the settlement or recovery of assets and
liabilities at the carrying values. Income tax assets are also
recognized for the benefits from tax losses and deductions that cannot
be identified with particular assets or liabilities, provided those
benefits are more likely than not to be realized. Future income tax
assets and liabilities are determined based on the tax laws and rates
that are anticipated to apply in the period of realization.

(k) Stock options

The company has a stock option plan as described in note 9(d). No
compensation expense is recognized when stock options are issued to
officers, directors and employees. Any consideration received by the
company on exercise of stock options is credited to share capital.

(l) Flow-through shares

The company, from time to time, issues flow-through shares to finance a
portion of its capital expenditure program. Pursuant to the terms of the
flow-through share agreements, the tax deductions associated with the
expenditures are renounced to the subscribers. Accordingly, share
capital is reduced and a future tax liability is recorded equal to the
estimated amount of future income taxes payable by the company as a
result of the renunciations, when the expenditures are incurred.

(m) Revenue recognition

Revenue from the sale of oil and gas is recognized based on volumes
delivered to customers at contractual delivery points and rates. The
costs associated with the delivery, including operating and maintenance
costs, transportation and royalties are recognized in the same period in
which the related revenue is earned and recorded.

(n) Risk management

The company purchases forward contracts to hedge its exposure to the
risks associated with fluctuating oil prices. Gains and losses
associated with risk management activities are recognized as adjustments
to oil and gas revenue at the time the related production is sold.

F-10
<PAGE> 60
WESTLINKS RESOURCES LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

(INFORMATION AS AT JUNE 30, 2000 AND FOR THE SIX-MONTH PERIODS
ENDED JUNE 30, 2000 AND JUNE 30, 1999 IS UNAUDITED)

4. CAPITAL ASSETS

<TABLE>
<CAPTION>
DECEMBER 31,
JUNE 30, ---------------------------
2000 1999 1998
----------- ----------- ------------
(RESTATED --
NOTE 10)
<S> <C> <C> <C>
Petroleum and natural gas properties and
equipment thereon.............................. $22,727,317 $ 8,120,552 $4,430,715
Office equipment and other....................... 70,225 66,887 42,159
----------- ----------- ----------
22,797,542 8,187,439 4,472,874
Accumulated depletion and depreciation........... (2,404,333) (1,170,713) (850,427)
----------- ----------- ----------
$20,393,209 $ 7,016,726 $3,622,447
=========== =========== ==========
</TABLE>

During the year ended December 31, 1999, the estimated future cash flows
from the proven reserves were less than the capitalized costs of the assets
in several areas where the company participates. As a result, the company
wrote down petroleum and natural gas properties by $65,652 (December 31,
1998 -- $NIL). This amount is included in depletion and depreciation
expense.

Future capital at June 30, 2000 included in the calculation of depletion
and depreciation includes the cost to develop proven undeveloped reserves
of $4,344,333 (December 31, 1999 -- $4,148,000; December 31, 1998 --
$71,000) less the recovery of future salvage values of $1,361,694 (December
31, 1999 -- $281,694; December 31, 1998 -- $200,000).

Costs of unproven petroleum and natural gas properties at June 30, 2000
amounting to $Nil (December 31, 1999 -- $18,654; December 31, 1998 -- $Nil)
have been excluded from the depletion calculation.

The estimated future site restoration costs to be accrued over the
remaining life of the proved reserves are approximately $1,152,559
(December 31, 1999 -- $540,634; December 31, 1998 -- $379,000).

5. INVESTMENTS

<TABLE>
<CAPTION>
DECEMBER 31,
JUNE 30, ----------------
2000 1999 1998
-------- ---- --------
<S> <C> <C> <C>
Red Raven Resources Inc., a public company, 1,720,000
common voting shares, at equity.......................... $430,000 $ -- $ --
Alsask Energy Services Ltd. ("Alsask"), a private company,
240,000 common voting shares at cost, representing 27% of
the issued and outstanding common shares................. -- -- 240,000
Raptor Capital Corporation, a public company, 1,250,000
units, each unit consisting of two common shares and one
share purchase warrant entitling the holder to purchase
one common share at a price of $0.15 per share expiring
April 7, 2001, at cost................................... 250,000 -- --
-------- ---- --------
$680,000 -- $240,000
======== ==== ========
</TABLE>

F-11
<PAGE> 61
WESTLINKS RESOURCES LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

(INFORMATION AS AT JUNE 30, 2000 AND FOR THE SIX-MONTH PERIODS
ENDED JUNE 30, 2000 AND JUNE 30, 1999 IS UNAUDITED)

A director of the company is also the Chairman of Raptor Capital
Corporation. The transaction involved a private placement of units to
several subscribers. This transaction was measured at the exchange amount,
which was the amount of the subscription price established by Raptor
Capital Corporation for the private placement.

During the year ended December 31, 1999, the shares of Alsask were sold for
$400,000 of capital assets for a gain of $160,000.

During the period ended June 30, 2000, the company's share of income from
Red Raven Resources Inc. was immaterial.

6. NOTES PAYABLE

On June 5, 2000, the company negotiated with certain individuals bridge
loans in the amount of $1,500,000 U.S. to finance the acquisitions of
petroleum and natural gas assets. The loans bear interest at 12% per annum,
repayable within 8 months and are unsecured. The company also issued
150,000 warrants to the lenders. Each warrant entitles the lenders to
acquire one common share at a price of $4.00 U.S. per share until March 5,
2001.

7. LONG-TERM DEBT

(a) At June 30, 2000, the company had a $12,500,000 (December 31, 1999 --
$NIL) revolving production loan at a Canadian chartered bank of which
$11,790,000 was drawn. The interest rate on the facility is prime plus
0.25% per annum payable monthly.

(b) At June 30, 2000, the company had a bridge loan commitment from a
Canadian chartered bank to a maximum of $3,800,000 which bears
interest at prime rate plus 2% per annum, to be repaid with the
proceeds of the equity issue described in note 15. The bridge loan
will not be advanced until the company has arranged equity funding on
an unconditional basis. Subsequent to June 30, 2000, this loan was
cancelled and is no longer available.

(c) At June 30, 2000, the company had a $NIL (December 31, 1999 --
$3,025,000; December 31, 1998 -- $1,300,000) revolving reducing credit
facility at a Canadian chartered bank of which $NIL (December 31, 1999
-- $2,600,000; December 31, 1998 -- $800,000) was drawn. The interest
rate on the facility was prime plus 1.5% per annum. This was repaid in
full with proceeds from the facility described in 7(a).

The facilities described in (a) and (b) are secured by a $25,000,000
floating charge debenture over all the assets of the company, a general
security agreement over all present and after acquired property and
assignment of long-term gas contracts exceeding 13 months.

The bank has indicated that it does not intend to require repayment of the
facility in the next 12 months and, therefore, the facility has been
classified long-term.

F-12
<PAGE> 62
WESTLINKS RESOURCES LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

(INFORMATION AS AT JUNE 30, 2000 AND FOR THE SIX-MONTH PERIODS
ENDED JUNE 30, 2000 AND JUNE 30, 1999 IS UNAUDITED)

8. INCOME TAXES

Income tax expense differs from that which would be expected from applying
the effective Canadian federal and provincial income tax rates of 44.62% to
income (loss) before taxes as follows:

<TABLE>
<CAPTION>
SIX MONTHS ENDED YEARS ENDED PERIOD FROM
JUNE 30, DECEMBER 31, APRIL 1, 1997 TO
----------------------- ------------------------ DECEMBER 31,
2000 1999 1999 1998 1997
-------- ------------ --------- ------------ ----------------
(RESTATED -- (RESTATED -- (RESTATED --
NOTE 10) NOTE 10) NOTE 10)
<S> <C> <C> <C> <C> <C>
Expected tax expense
(recovery).................. $955,350 $(111,094) $(132,259) $167,047 $121,685
Increase (decrease) resulting
from
Non-deductible crown
payments, net of Alberta
Royalty Tax Credits...... 490,232 23,202 74,796 16,744 17,361
Resource allowance.......... (591,656) (29,895) (72,470) (49,753) (45,821)
Capital loss carryforward
not previously
recognized............... -- -- (100,395) -- --
Non-taxable portion of
capital gain............. -- -- (17,848) -- (19,722)
Other....................... -- 1,642 1,292 (13,741) (16,039)
-------- --------- --------- -------- --------
Future income taxes
(recovery).................. $853,926 $(116,145) $(246,884) $120,297 $ 57,464
======== ========= ========= ======== ========
</TABLE>

The components of the future income tax liability at June 30, 2000,
December 31, 1999 and 1998 are as follows:

<TABLE>
<CAPTION>
DECEMBER 31,
JUNE 30, ------------------------
2000 1999 1998
---------- -------- ------------
(RESTATED --
NOTE 10)
<S> <C> <C> <C>
Temporary differences related to capital assets...... $1,314,144 $672,269 $644,901
Investments.......................................... -- -- 46,851
Future site restoration.............................. (92,780) (80,910) (59,209)
Share issuance costs................................. (34,777) (42,585) (40,119)
Tax loss carryforward................................ -- (216,113) (338,294)
Attributed Royalty Income carryforward............... (34,868) (34,868) (13,654)
---------- -------- --------
$1,151,719 $297,793 $240,476
========== ======== ========
</TABLE>

F-13
<PAGE> 63
WESTLINKS RESOURCES LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

(INFORMATION AS AT JUNE 30, 2000 AND FOR THE SIX-MONTH PERIODS
ENDED JUNE 30, 2000 AND JUNE 30, 1999 IS UNAUDITED)

9. SHARE CAPITAL

(a) Authorized
Unlimited number of common voting shares
Unlimited number of preferred shares issuable in one or more series

(b) Issued

<TABLE>
<CAPTION>
DECEMBER 31,
--------------------------------------------------
JUNE 30, 2000 1999 1998
---------------------- ---------------------- -------------------------
STATED STATED STATED
NUMBER VALUE NUMBER VALUE NUMBER VALUE
--------- ---------- --------- ---------- ------------ ----------
(RESTATED --
NOTE 9[C]
AND 10)
<S> <C> <C> <C> <C> <C> <C>
COMMON SHARES
Balance, beginning of period....... 4,042,639 $3,638,407 2,610,639 $2,360,607 2,072,700 $1,924,875
Issued for PTR shares (notes
2[b], 9[c]).................... -- -- -- -- 647,837 534,999
Shares eliminated on amalgamation
(notes 2[b], 9[c])............. -- -- -- -- (109,898) (76,104)
Issued for cash pursuant to
private placement.............. -- -- 1,175,000 1,175,000 -- --
Issued upon exercise of options
(note 9[d]).................... 390,000 390,000 257,000 102,800 -- --
Tax cost of flow-through share
renouncement................... -- -- -- -- -- (23,163)
--------- ---------- --------- ---------- --------- ----------
Balance, end of period............. 4,432,639 4,028,407 4,042,639 3,638,407 2,610,639 2,360,607
========= ========= =========
Issue costs, net of income tax
benefit, $49,402 (December 31,
1999 -- $49,402; December 31,
1998 -- $31,321)............... (125,577) (125,577) (103,136)
---------- ---------- ----------
3,902,830 3,512,830 2,257,471
---------- ---------- ----------
WARRANTS
Balance, beginning of period....... 302,000 150,500 302,000 150,500 -- --
Issued pursuant to business
combination (note 9[e])........ -- -- -- -- 300,000 150,000
Issued pursuant to bank
financing...................... -- -- -- -- 2,000 500
Issued pursuant to notes payable
(note 6)....................... 150,000 -- -- -- -- --
Expired (note 9[e]).............. (302,000) (150,500) -- -- -- --
--------- ---------- --------- ---------- --------- ----------
Balance, end of period............. 150,000 -- 302,000 150,500 302,000 150,500
========= ---------- ========= ---------- ========= ----------
$3,902,830 $3,663,330 $2,407,971
========== ========== ==========
</TABLE>

(c) Temba Resources Ltd. ("Temba") acquired and amalgamated with PTR to
continue as Westlinks Resources Ltd. ("Westlinks") effective June 30,
1998. Under the terms of the amalgamation, the holders of the issued
and outstanding shares of Temba received one (1) common share of the
amalgamated corporation, Westlinks, for every five (5) common shares
of Temba. The holders of the issued and outstanding shares of PTR
received one (1) common share of the amalgamated corporation for every
thirty-one and one quarter (31.25) common shares of PTR. In addition,
any common shares of Temba held by PTR and any common shares of PTR
held by Temba were cancelled upon amalgamation.

F-14
<PAGE> 64
WESTLINKS RESOURCES LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

(INFORMATION AS AT JUNE 30, 2000 AND FOR THE SIX-MONTH PERIODS
ENDED JUNE 30, 2000 AND JUNE 30, 1999 IS UNAUDITED)

(d) Employee fixed stock option plan

Under the employee fixed stock option plan, the company may grant
options to its officers, directors and employees for up to 10% of the
issued common shares. Options granted under the plan have a term of five
years and vest when granted. The exercise price of each option equals
the market price of the company's shares at the grant date of the
options. As at June 30, 2000, 53,000 stock options were outstanding
under the plan at an exercise price of $2.00 per share expiring on
February 24, 2004 and 390,000 stock options at an exercise price of
$6.15 per share expiring on May 28, 2005.

A summary of the status of the company's fixed stock option plan as of
June 30, 2000, December 31, 1999 and December 31, 1998, and changes
during the periods then ending is as follows:

<TABLE>
<CAPTION>
DECEMBER 31,
JUNE 30, -------------------------------------------
2000 1999 1998
-------------------- -------------------- --------------------
WEIGHTED WEIGHTED WEIGHTED
AVERAGE AVERAGE AVERAGE
NUMBER OF EXERCISE NUMBER OF EXERCISE NUMBER OF EXERCISE
OPTIONS PRICE OPTIONS PRICE OPTIONS PRICE
--------- -------- --------- -------- --------- --------
<S> <C> <C> <C> <C> <C> <C>
Outstanding, beginning of
period.......................... 260,000 $1.00 262,000 $0.40 -- $ --
Granted........................... 573,000 4.60 260,000 1.00 262,000 0.40
Exercised......................... (390,000) 1.00 (257,000) 0.40 -- --
Cancelled......................... -- -- (5,000) 0.40 -- --
-------- ----- -------- ----- ------- -----
Outstanding and exercisable, end
of period....................... 443,000 $5.65 260,000 $1.00 262,000 $0.40
======== ===== ======== ===== ======= =====
</TABLE>

(e) Warrants

Included in the consideration given to I.G. in 1997 pursuant to a
business combination were 300,000 common share purchase warrants with an
agreed aggregate value of $150,000. Each warrant entitled I.G. to
acquire one common share at a price of $2.50 until January 8, 2000. The
warrants expired unexercised.

The warrants issued pursuant to a bank financing expired unexercised
during the period ended March 31, 2000.

(f) At June 30, 2000, NIL (December 31, 1999 -- 133,334; December 31, 1998
-- 266,667) of the common shares of the company are held in escrow.

(g) Net income (loss) per share and funds provided from operations per
share are calculated based on the weighted average number of common
shares outstanding during the period of 4,334,068 (June 30, 1999 --
2,628,002; December 31, 1999 -- 2,928,975; December 31, 1998 --
2,350,174; December 31, 1997 -- 1,349,717).

In the calculation of fully diluted income and funds provided from fully
diluted operations per share, options under the stock option plan are
assumed to have been exercised on the later of the beginning of the year
or the date granted. Imputed funds received on the conversion of options
is assumed to have earned a return of 8.0% (4.4% after tax) (June 30,
1999 -- 8.0% [4.4% after tax]; December 31, 1998 -- 8.0% [4.4% after
tax]; December 31, 1997 -- 8.0% [4.4% after tax]).

F-15
<PAGE> 65
WESTLINKS RESOURCES LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

(INFORMATION AS AT JUNE 30, 2000 AND FOR THE SIX-MONTH PERIODS
ENDED JUNE 30, 2000 AND JUNE 30, 1999 IS UNAUDITED)

10. CHANGE IN ACCOUNTING POLICY

At December 31, 1999, the company changed its method of accounting for
income taxes from the deferral method to the liability method. This policy
has been adopted retroactively with restatement of 1998 and 1997 results.
The impact of these changes on the June 30, 1999 and December 31, 1999,
1998 and 1997 consolidated financial statements are as follows:

<TABLE>
<CAPTION>
BEFORE CHANGE AFTER CHANGE
IN ACCOUNTING IN ACCOUNTING
POLICY ADJUSTMENT POLICY
------------- ---------- -------------
<S> <C> <C> <C>
JUNE 30, 1999
Depletion and depreciation........................ $ 287,760 $ 1,557 $ 289,317
Future income taxes (recovery).................... -- (116,145) (116,145)
Deferred tax (recovery)........................... (69,000) 69,000 --
Net income (loss)................................. (178,420) 45,588 (132,832)
DECEMBER 31, 1999
Capital assets.................................... $6,714,444 $ 302,282 $7,016,726
Future income taxes............................... -- 297,793 297,793
Share capital..................................... 3,697,440 (34,110) 3,663,330
Retained earnings................................. 275,705 38,599 314,304
Depletion and depreciation........................ 819,119 22,461 841,580
Gain on sale of capital assets.................... 129,925 (38,523) 91,402
Future income taxes (recovery).................... -- (246,884) (246,884)
Deferred tax (recovery)........................... (69,000) 69,000 --
Net income (loss)................................. (166,427) 116,900 (49,527)
Net income (loss) per share....................... (0.06) 0.04 (0.02)
DECEMBER 31, 1998
Capital assets.................................... $3,581,464 $ 40,983 $3,622,447
Deferred income taxes............................. 69,000 (69,000) --
Future income taxes............................... -- 240,476 240,476
Share capital..................................... 2,460,163 (52,192) 2,407,971
Retained earnings................................. 442,132 (78,301) 363,831
Depletion and depreciation........................ 797,403 7,540 804,943
Future income taxes............................... -- 120,297 120,297
Net income (loss)................................. 381,918 (127,837) 254,081
Net income (loss) per share....................... 0.16 (0.05) 0.11
DECEMBER 31, 1997
Deferred income taxes............................. $ 107,000 $(107,000) --
Future income taxes............................... -- 57,464 57,464
Net income........................................ 165,714 49,536 215,250
Net income per share.............................. 0.12 0.04 0.16
</TABLE>

F-16
<PAGE> 66
WESTLINKS RESOURCES LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

(INFORMATION AS AT JUNE 30, 2000 AND FOR THE SIX-MONTH PERIODS
ENDED JUNE 30, 2000 AND JUNE 30, 1999 IS UNAUDITED)

11. COMMITMENTS

(a) The company is committed under leases on its office premises and
vehicles for future minimum lease payments as follows:

<TABLE>
<S> <C>
July 1 - December 31, 2000.................................. $ 77,099
January 1 - December 31, 2001............................... 170,553
January 1 - December 31, 2002............................... 152,742
January 1 - December 31, 2003............................... 110,765
January 1 - December 31, 2004............................... 79,656
--------
$590,815
========
</TABLE>

(b) The company has entered into a fixed price contract. Under the terms
of the contract, the company is required to deliver a physical
quantity of 100 barrels per day of oil at a price of $29.70/bbl
expiring August 31, 2000 and 100 barrels per day of oil at a price of
$32.00/bbl from February 1, 2000 to August 31, 2000, at various
Alberta delivery points.

12. TERMINATION BENEFITS

During the year ended December 31, 1999, the company terminated certain
employees and officers of the company. Included in general and
administrative expense is $128,803 of severance and related costs of the
termination.

13. FINANCIAL INSTRUMENTS

Fair values

The fair value of all financial instruments approximate their carrying
value.

14. CONTINGENCY

On March 4, 1998, claims totalling $22,500 were filed against the company.
The company made a counterclaim of $800,000 on March 26, 1998. The company
believes that the original claims are without merit. The outcomes of the
claims and counterclaim are not determinable at this time.

15. SUBSEQUENT EVENTS

(a) Public offering

The company intends to enter into an underwriting agreement with Prima
Terra Capital Division of Merit Capital Associates, Inc., and Spencer
Edwards, Inc. (as representative of the several underwriters) to offer
to the public one million common shares and one million warrants, at a
price to be negotiated. In addition, the company will grant the
underwriters the option to purchase up to an additional 150,000 common
shares and 150,000 warrants to cover any over-allotments. Each warrant
will entitle the holder to purchase one common share for six months
after the date of the final prospectus at an exercise price to be
negotiated. The costs of arranging the issue, including the
underwriters' commission are estimated to be US$955,000, assuming the
over-allotment option is not exercised. In addition to a commission of
10% of the gross proceeds of the issue, the underwriters will receive a
3% non-accountable expense allowance and will be granted

F-17
<PAGE> 67
WESTLINKS RESOURCES LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

(INFORMATION AS AT JUNE 30, 2000 AND FOR THE SIX-MONTH PERIODS
ENDED JUNE 30, 2000 AND JUNE 30, 1999 IS UNAUDITED)

non-transferable five year warrants to acquire 200,000 common shares at
an exercise price per share equal to 120% of the public offering price.
The warrants may not be exercised for one year from the date of the
offering.

(b) Notes payable

Subsequent to June 30, 2000, the bridge loans, as described in note 6,
were repaid and the 150,000 warrants were exercised. Included in the
repayment terms was a set-up fee of $50,000 U.S.

The company entered into an agreement, effective October 1, 2000, to
sell all of its Bigoray assets except natural gas in the Belly River
formation for cash consideration of $4,583,500. The sale is scheduled to
close October 26, 2000 and will be effective from October 1, 2000.

16. UNITED STATES ACCOUNTING PRINCIPLES AND REPORTING

The company's consolidated financial statements have been prepared in
Canadian dollars and in accordance with generally accepted accounting
principles in Canada ("Canadian GAAP"). These principles, as they pertain
to the company's financial statements, differ from United States generally
accepted accounting principles ("U.S. GAAP") as follows:

(a) Depreciation

U.S. GAAP requires office equipment and other to be depreciated using
the straight-line depreciation method rather than the declining balance
method used under Canadian GAAP.

The conversion to the straight-line depreciation method would not have a
material effect on the financial statements and therefore this
difference has not been reflected in the reconciliation.

(b) Income taxes

U.S. GAAP, specifically the statement of Financial Accounting Standards
No. 109 ("FAS 109") "Accounting for Income Taxes", requires the
recognition of future tax assets and liabilities for the expected future
tax consequences of events that have been recognized in the company's
financial statements or tax returns. In estimating future tax
consequences, FAS 109 generally considers all expected events including
enacted changes in laws or rates.

Canadian GAAP previously required the company provide for potential
future taxes using the deferral method, however, the Canadian Institute
of Chartered Accountants has issued a new accounting standard which is
similar to U.S. GAAP. The new standard is mandatory for fiscal years
commencing on or after January 1, 2000 but it may be adopted earlier.

The company has adopted the new Canadian standard for the year ended
December 31, 1999 and adopted this policy retroactively with restatement
(note 10). The Canadian standard differs from U.S. GAAP in the
accounting for the taxation effect of flow-through shares, where the tax
deduction associated with certain expenditures are renounced to
subscribers (note 3[l]). Under Canadian GAAP, share capital is reduced
and a future tax liability is recorded equal to the estimated amount of
future taxes payable due to the renunciations, whereas under U.S. GAAP,
the tax effect is a charge against income, instead of a reduction of
share capital.

F-18
<PAGE> 68
WESTLINKS RESOURCES LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

(INFORMATION AS AT JUNE 30, 2000 AND FOR THE SIX-MONTH PERIODS
ENDED JUNE 30, 2000 AND JUNE 30, 1999 IS UNAUDITED)

Contrary to Canadian GAAP, U.S. GAAP requires the inclusion of stock
options, warrants and certain convertible securities in the calculation
of diluted earnings per share using the treasury stock method. The
treasury stock method requires the inclusion of the options as if they
were exercised at the later of the beginning of the year or the date
granted and as if the funds were used to purchase the corporation's own
stock.

The conversion from Canadian to U.S. GAAP had no effect on the diluted
net income (loss) per share.

Under U.S. GAAP, escrow shares are not considered to be outstanding for
the calculation of earnings per share. Comprehensive income (loss) per
share is calculated based on the weighted average number of common
shares outstanding during the period of 4,267,401 (June 30, 1999 --
2,428,002; December 31, 1999 -- 2,740,086; December 31, 1998 --
2,050,174; December 31, 1997 -- 949,717).

(d) Stock based compensation

Contrary to Canadian GAAP, U.S. GAAP requires a company to disclose the
cost of stock compensation awards, at their fair value, at the date the
award is granted. The fair value of the company's options was estimated
using the Black-Scholes model with assumptions of a 274 day expected
term, 161% volatility (June 30, 1999 -- 189%; December 31, 1999 -- 189%;
December 31, 1998 -- 189%; December 31, 1997 -- 189%) and an interest
rate of 6.5% (June 30, 1999 -- 6.5%; December 31, 1999 -- 6.5%; December
31, 1998 -- 6.5%; December 31, 1997 -- 5.0%). Under U.S. GAAP, the cost
of stock compensation for the period ended June 30, 2000 would be
$728,640 (June 30, 1999 -- $33,613; December 31, 1999 -- $86,076;
December 31, 1998 -- $40,583; December 31, 1997 -- $12,736). The
resulting net income (loss) and net income (loss) per share for the
period ended June 30, 2000 would be $558,515 and $0.13, respectively
(June 30, 1999 -- $(166,445) and $(0.06); December 31, 1999 --
$(135,603) and $(0.05); December 31, 1998 -- $213,498 and $0.09;
December 31, 1997 -- $202,514 and $0.15).

(e) Investments

Canadian GAAP requires investments that the company does not have a
significant influence in to be recorded using the cost method of
accounting whereby the investments are initially recorded at cost. Where
there has been a permanent decline in value, the investments are stated
at estimated net realizable value.

Under U.S. GAAP, the company's investments would be classified as
"Available-For-Sale" using the cost method of accounting and require
that the securities be recorded at fair market value. As the difference
between cost and fair market value has not been realized, any unrealized
holding gains or losses would be reported as other comprehensive income
(i.e. as a separate component of shareholders' equity) until realized.

(f) Long-term debt

U.S. GAAP requires that all demand loans be classified as current unless
the company intends to refinance on a long-term basis and the intent is
supported by the ability to refinance. As the company's loan does not
clearly permit refinancing on a long-term basis under U.S. GAAP, it
would be classified as a current liability.

F-19
<PAGE> 69
WESTLINKS RESOURCES LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

(INFORMATION AS AT JUNE 30, 2000 AND FOR THE SIX-MONTH PERIODS
ENDED JUNE 30, 2000 AND JUNE 30, 1999 IS UNAUDITED)

(g) Financial instruments

In June 1998, the Financial Accounting Standards Board issued FAS No.
133 and 137 "Accounting for Derivative Instruments and Hedging
Activities" which will be effective for the company's 2001 fiscal year.
Under the new standard, companies will be required to record derivatives
on the balance sheet as assets or liabilities measured at fair value.
For those derivatives representing effective hedges of risks and
exposures, unrealized gains or losses resulting from changes in the fair
values will be presented as a component of comprehensive income as
defined by FAS No. 130. To the extent certain derivatives do not
represent effective hedges, unrealized gains or losses will be included
in the income statement for U.S. GAAP purposes. The company is currently
reviewing the standard but as at June 30, 2000 the standard would have
no impact on its reported U.S. GAAP financial information as the company
held no forward contracts.

(h) Balance sheets

The adjustments using U.S. GAAP would result in the following changes to
the consolidated balance sheets of the company:

<TABLE>
<CAPTION>
AS AT AS AT
JUNE 30, 2000 DECEMBER 31, 1999 DECEMBER 31, 1998
------------------------- ----------------------- -----------------------
CANADIAN CANADIAN CANADIAN
GAAP U.S. GAAP GAAP U.S. GAAP GAAP U.S. GAAP
----------- ----------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Assets
Current assets............ $ 1,376,942 $ 1,376,942 $ 727,075 $ 727,075 $ 305,227 $ 305,227
Capital assets............ 20,393,209 20,393,209 7,016,726 7,016,726 3,622,447 3,622,447
Investments............... 680,000 880,000 -- -- 240,000 360,000
Deferred share issuance
costs................... 282,110 282,110 -- -- -- --
----------- ----------- ---------- ---------- ---------- ----------
$22,732,261 $22,932,261 $7,743,801 $7,743,801 $4,167,674 $4,287,674
=========== =========== ========== ========== ========== ==========
Liabilities
Current liabilities....... $ 3,927,820 $15,717,820 $1,762,042 $3,287,042 $ 322,700 $1,022,700
Long-term debt............ 11,790,000 -- 1,525,000 -- 700,000 --
Future income taxes....... 1,151,719 1,218,649 297,793 297,793 240,476 280,634
Provision for future site
restoration............. 207,933 207,933 181,332 181,332 132,696 132,696
----------- ----------- ---------- ---------- ---------- ----------
17,077,472 17,144,402 3,766,167 3,766,167 1,395,872 1,436,030
----------- ----------- ---------- ---------- ---------- ----------
Shareholders' equity
Share capital............. 3,902,830 3,948,343 3,663,330 3,708,843 2,407,971 2,453,484
Contributed surplus....... 150,500 150,500 -- -- -- --
Comprehensive income...... -- 133,070 -- -- -- 79,842
Retained earnings......... 1,601,459 1,555,946 314,304 268,791 363,831 318,318
----------- ----------- ---------- ---------- ---------- ----------
5,654,789 5,787,859 3,977,634 3,977,634 2,771,802 2,851,644
----------- ----------- ---------- ---------- ---------- ----------
$22,732,261 $22,932,261 $7,743,801 $7,743,801 $4,167,674 $4,287,674
=========== =========== ========== ========== ========== ==========
</TABLE>

F-20
<PAGE> 70
WESTLINKS RESOURCES LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

(INFORMATION AS AT JUNE 30, 2000 AND FOR THE SIX-MONTH PERIODS
ENDED JUNE 30, 2000 AND JUNE 30, 1999 IS UNAUDITED)

(i) Income statements

The adjustments using U.S. GAAP would result in the following changes to
the consolidated income statements of the company:

<TABLE>
<CAPTION>
SIX MONTHS ENDED YEARS ENDED PERIOD FROM
JUNE 30, DECEMBER 31, APRIL 1, 1997 TO
---------------------- -------------------- DECEMBER 31,
2000 1999 1999 1998 1997
---------- --------- --------- -------- ----------------
<S> <C> <C> <C> <C> <C>
Net income (loss) using
Canadian GAAP.......... $1,287,155 $(132,832) $ (49,527) $254,081 $215,250
U.S. GAAP adjustment
Income taxes -- FAS
109.................... -- -- -- (23,163) (22,350)
---------- --------- --------- -------- --------
Net income (loss) using
U.S. GAAP.............. 1,287,155 (132,832) (49,527) 230,918 192,900
Other comprehensive
income
Unrealized holding gains
on investments arising
(reversing) during the
period, net of tax
effect of $66,930
(December 31, 1999 --
$40,158; December 31,
1998 -- $(40,158))..... 133,070 -- (79,842) 79,842 --
---------- --------- --------- -------- --------
Comprehensive income
(loss)................. $1,420,225 $(132,832) $(129,369) $310,760 $192,900
========== ========= ========= ======== ========
Comprehensive income
(loss) per share....... $ 0.33 $ (0.05) $ (0.04) $ 0.13 $ 0.14
========== ========= ========= ======== ========
</TABLE>

17. COMPARATIVE FIGURES

The presentation of certain figures of the previous periods have been
changed to conform with the presentation adopted for the current period.

F-21
<PAGE> 71

WESTLINKS RESOURCES LTD.

SUPPLEMENTAL INFORMATION ON OIL AND GAS EXPLORATION

AND PRODUCTION ACTIVITIES

(UNAUDITED)

CAPITALIZED COSTS

The following table summarizes capitalized costs for oil and gas
exploration and production activities, and the related accumulated depreciation
and depletion:

<TABLE>
<CAPTION>
DECEMBER 31,
JUNE 30, ----------------------
2000 1999 1998
-------- ------------ ------
(000'S)
<S> <C> <C> <C>
Proved oil and gas properties............................... $22,727 $8,121 $4,431
Unproved oil and gas properties.............................
Total property costs...................................... 22,727 8,121 4,431
Accumulated depreciation and depletion...................... 2,376 1,148 830
------- ------ ------
Net capitalized costs..................................... $20,351 $6,973 $3,601
======= ====== ======
</TABLE>

COSTS INCURRED

Property acquisition costs include costs incurred to purchase, lease or
otherwise acquire oil and gas properties. Exploration costs include the costs of
geological and geophysical activity, carrying and retaining undeveloped
properties, and drilling and equipping exploratory wells. Development costs
include the costs of drilling and equipping development wells and facilities to
treat, gather and store oil and gas.

<TABLE>
<CAPTION>
DECEMBER 31,
JUNE 30, ----------------------
2000 1999 1998
-------- ------------ ------
(000'S)
<S> <C> <C> <C>
Property acquisition:
Proved.................................................... $11,721 $2,659 $ 244
Unproved..................................................
Exploration.................................................
Development................................................. 3,396 1,110 33
------- ------ ------
Total..................................................... $15,117 $3,769 $ 277
======= ====== ======
</TABLE>

F-22
<PAGE> 72

WESTLINKS RESOURCES LTD.

SUPPLEMENTAL INFORMATION ON OIL AND GAS EXPLORATION

AND PRODUCTION ACTIVITIES -- (CONTINUED)

(UNAUDITED)

OIL AND GAS RESERVES

The following information describes changes during the years and balances
of proved oil and gas reserves.

Proved oil and gas reserves are the estimated quantities of crude oil and
natural gas and natural gas liquids which geological and engineering data
demonstrate with reasonable certainty to be recoverable in future years from
known reservoirs under existing economic and operating conditions as of the date
the estimate is made.

ESTIMATED PROVED RESERVES

<TABLE>
<CAPTION>
OIL & NGL NATURAL GAS
--------- -----------
MBBL MMCF
<S> <C> <C>
December 31, 1997........................................... 560 5,873
Revisions of previous estimates........................... 133 257
Extensions and discoveries................................
Purchases.................................................
Sales..................................................... (3) (5,493)
Production................................................ (86) (220)
December 31, 1998........................................... 604 417
Revisions of previous estimates........................... 126 263
Extensions and discoveries................................
Purchases................................................. 930 231
Sales..................................................... (44) (234)
Production................................................ (93) (61)
December 31, 1999........................................... 1,539 617
Revisions of previous estimates........................... 51 80
Extensions and discoveries................................ 239
Purchases................................................. 1,500 115
Sales..................................................... (80)
Production................................................ (170) (25)
June 30, 2000............................................... 3,079 787
</TABLE>

F-23
<PAGE> 73

WESTLINKS RESOURCES LTD.

SUPPLEMENTAL INFORMATION ON OIL AND GAS EXPLORATION

AND PRODUCTION ACTIVITIES -- (CONTINUED)

(UNAUDITED)

STANDARDIZED MEASURE OF DISCOUNTED FUTURE CASH FLOWS

The standardized measure of discounted future net cash flows is computed by
applying year-end prices, costs and legislated tax rates and a discount factor
of 10 percent to net proved reserves. The Company has corporate tax pools the
effect of which has not been taken into account. These tax pools will reduce the
amount of future income taxes actually paid.

STANDARDIZED MEASURE OF DISCOUNTED CASH FLOWS

<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
2000 1999
-------- ------------
(000'S)
<S> <C> <C>
Future cash inflows......................................... $96,970 $47,520
Future development and production costs..................... 31,016 16,768
Future income taxes......................................... 24,624 11,415
Future net cash flows..................................... 41,330 19,337
Ten per cent annual discount................................ 14,820 7,844
------- -------
Discounted net cash flows................................. $26,510 $11,493
======= =======
</TABLE>

CHANGES IN STANDARDIZED MEASURE OF DISCOUNTED FUTURE CASH FLOWS

<TABLE>
<CAPTION>
JUNE 30,
2000
--------
(000'S)
<S> <C>
Beginning balance........................................... $11,493
Value of reserves added................................... 20,260
Changes in value of previous year due to:
Sales net of production costs.......................... (3,638)
Development costs incurred............................. 3,396
Net change in prices and development and production
costs................................................. (406)
Sales of reserves...................................... (527)
Revisions of previous reserve estimates................ --
Accretion of discount.................................. 971
Net change in income taxes................................ (4,539)
-------
Ending balance.............................................. $26,510
=======
</TABLE>

F-24
<PAGE> 74

COMPILATION REPORT

To the Directors
Westlinks Resources Ltd.

We have reviewed, as to compilation only, the accompanying pro-forma
consolidated balance sheet of Westlinks Resources Ltd. as at June 30, 2000 which
has been prepared for inclusion in the prospectus relating to the offering of
1,000,000 units. Each unit consists of one common share and one common share
purchase warrant. In our opinion, the pro-forma consolidated balance sheet has
been properly compiled to give effect to the proposed transactions and the
assumptions described in note 2 thereto.

We have compiled this report in accordance with generally accepted auditing
standards in Canada under section 7100 of the Canadian Institute of Chartered
Accountants' Handbook. This report is considered to have no basis for reliance
for U.S. reporting purposes and, as a result, is not permitted by the SEC staff
in filings by U.S. companies, and no opinion is expressed under generally
accepted auditing standards in the United States.

(signed) COLLINS BARROW
Chartered Accountants

Calgary, Alberta
August 10, 2000

F-25
<PAGE> 75

WESTLINKS RESOURCES LTD.

PRO-FORMA CONSOLIDATED BALANCE SHEET

JUNE 30, 2000
(UNAUDITED)
(Expressed in Canadian dollars)
(Adjusted for U.S. GAAP)

<TABLE>
<CAPTION>
ISSUE OF
UNADJUSTED COMMON PRO-FORMA
AT JUNE 30, SHARES JUNE 30,
2000 (NOTE 2) 2000
----------- ----------- -----------
(UNAUDITED)
<S> <C> <C> <C>
ASSETS
Current assets
Cash and short-term investments................... $ 1,935 $ 6,810,510 $ 6,812,445
Accounts receivable............................... 1,375,007 -- 1,375,007
----------- ----------- -----------
1,376,942 6,810,510 8,187,452
Capital assets...................................... 20,393,209 -- 20,393,209
Investments......................................... 880,000 -- 880,000
Deferred share issuance costs....................... 282,110 (282,110) --
----------- ----------- -----------
$22,932,261 $ 6,528,400 $29,460,661
=========== =========== ===========
LIABILITIES
Current liabilities
Accounts payable and accrued liabilities.......... $ 1,690,720 $ -- $ 1,690,720
Notes payable..................................... 2,237,100 -- 2,237,100
Bank demand loan payable.......................... 11,790,000 -- 11,790,000
----------- ----------- -----------
15,717,820 -- 15,717,820
Future income taxes................................. 1,218,649 -- 1,218,649
Provision for future site restoration............... 207,933 -- 207,933
----------- ----------- -----------
17,144,402 -- 17,144,402
----------- ----------- -----------
SHAREHOLDERS' EQUITY
Share capital....................................... 3,948,343 6,528,400 10,476,743
Contributed surplus................................. 150,500 -- 150,500
Retained earnings................................... 1,689,016 -- 1,689,016
----------- ----------- -----------
5,787,859 6,528,400 12,316,259
----------- ----------- -----------
$22,932,261 $ 6,528,400 $29,460,661
=========== =========== ===========
</TABLE>

F-26
<PAGE> 76

WESTLINKS RESOURCES LTD.

NOTES TO PRO-FORMA CONSOLIDATED BALANCE SHEET

JUNE 30, 2000
(UNAUDITED)
(Expressed in Canadian dollars)
(Adjusted for U.S. GAAP)

1. BASIS OF PRESENTATION

The accompanying pro-forma consolidated balance sheet of Westlinks
Resources Ltd. ("Westlinks") has been prepared by management to give effect
to the issue of common shares in a registration statement dated -- .

The pro-forma consolidated balance sheet has been prepared from the
unaudited consolidated balance sheet of Westlinks as at June 30, 2000. In
the opinion of the management of Westlinks, the pro-forma consolidated
balance sheet as at June 30, 2000 includes all adjustments necessary for a
fair presentation of the above mentioned occurrence of events.

The pro-forma consolidated balance sheet as at June 30, 2000 should be read
in conjunction with the audited and unaudited consolidated financial
statements of Westlinks included elsewhere in the prospectus.

2. PRO-FORMA ASSUMPTIONS AND ADJUSTMENTS

Accounting policies used in the preparation of the pro-forma consolidated
balance sheet are in accordance with those disclosed in Westlinks's audited
consolidated financial statements for the year ended December 31, 1999.

The pro-forma consolidated balance sheet gives effect to the following
assumptions and adjustments:

(a) The issuance of 1,000,000 units of common stock pursuant to the
offering under the prospectus.

The issuance is summarized as follows:

<TABLE>
<S> <C>
Issuance proceeds........................................... $7,980,000
Issuance costs.............................................. 1,451,600
----------
Issuance proceeds (net)..................................... $6,528,400
==========
</TABLE>

F-27
<PAGE> 77

AUDITORS' REPORT

To the Board of Directors of Westlinks Resources Ltd.

At the request of Westlinks Resources Ltd. (the "Corporation") we have
audited the Schedule of Revenue and Expenses associated with certain properties
acquired from Cabre Exploration Ltd. for the years ended December 31, 1999, 1998
and 1997. This financial information is the responsibility of the Corporation's
management. Our responsibility is to express an opinion on this financial
information based on our audit.

We conducted our audit in accordance with Canadian generally accepted
auditing standards. Those standards require that we plan and perform an audit to
obtain reasonable assurance whether the financial information is free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial information. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall presentation of the
financial information.

In our opinion, this financial information presents fairly, in all material
respects, the revenue and expenses for the properties for the years ended
December 31, 1999, 1998 and 1997 in accordance with the basis of accounting
disclosed in note 1.

KPMG LLP

Chartered Accountants

Calgary, Canada

September 25, 2000

F-28
<PAGE> 78

WESTLINKS RESOURCES LTD.

SCHEDULE OF REVENUE AND EXPENSES OF THE

PROPERTIES ACQUIRED FROM CABRE EXPLORATION LTD.

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
---------------------------------------
1999 1998 1997
----------- ----------- -----------
<S> <C> <C> <C>
Revenue................................................. $ 7,431,844 $ 5,764,638 $ 4,512,995
Royalties............................................... (1,224,260) (951,500) (740,565)
Operating expenses...................................... (1,815,566) (1,762,301) (1,068,060)
----------- ----------- -----------
Excess of revenue over expenses......................... $ 4,392,018 $ 3,050,837 $ 2,704,370)
=========== =========== ===========
</TABLE>

See accompanying notes to schedule of revenue and expenses for selected
properties.

F-29
<PAGE> 79

WESTLINKS RESOURCES LTD.

NOTES TO SCHEDULE OF REVENUE AND EXPENSES OF THE

PROPERTIES ACQUIRED FROM CABRE EXPLORATION LTD.

YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997

1. BASIS OF PRESENTATION:

Prepared in accordance with Canadian generally accepted accounting
principles as follows:

This Schedule of Revenue and Expenses (the "Schedule") includes only those
revenues and expenses related to the Sounding Lake properties acquired by
Westlinks Resources Ltd. (the "Corporation") from Cabre Exploration Ltd.
pursuant to a purchase and sale agreement dated April 6, 2000 for the
Sounding Lake properties.

The Schedule has been prepared by Westlinks Energy Ltd. and has been
derived from financial information obtained on the acquisition of
properties.

The Schedule includes only amounts applicable to the working interest of
the Corporation in the acquired properties.

The Schedule includes only those revenues and expenses directly related to
the properties and does not include any provision for the depletion,
depreciation, site restoration, future capital costs, impairment of
unevaluated properties, corporate general and administrative costs, capital
and income taxes.

There would be no differences between the accounting policies followed and
applicable U.S. generally accepted accounting principles

2. SIGNIFICANT ACCOUNTING POLICIES:

(a) Revenue and royalties:

Oil and natural gas sales and related royalties are recorded at the time
the related oil and natural gas substances are produced.

(b) Operating expenses:

Operating costs include amounts incurred during lifting oil and natural
gas to the surface, gathering, transportation, field processing,
treating and storage of petroleum and natural gas.

F-30
<PAGE> 80

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

WESTLINKS RESOURCES LTD.

1,000,000 SHARES OF COMMON STOCK
AND
1,000,000 COMMON STOCK PURCHASE WARRANTS

PRIMA TERRA CAPITAL SPENCER EDWARDS, INC.
DIVISION OF MERIT CAPITAL ASSOCIATES, INC.

-- , 2000

You may rely only on the information contained in the prospectus. We have
not authorized anyone to provide information different from that contained in
this prospectus. Neither the delivery of this prospectus nor sale of units means
that information contained in this prospectus is correct after the date of this
prospectus. This prospectus is not an offer to sell or solicitation of an offer
to buy these securities in any circumstances under which the offer or
solicitation is unlawful.

Until -- , 2000 (90 days after the date of this prospectus), all
dealers effecting transactions in the United States in the common stock and
warrants, whether or not participating in this offering, may be required to
deliver a prospectus. This is in addition to the obligations of dealers to
deliver a prospectus when acting as underwriters and with respect to their
unsold allotments or subscriptions.

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE> 81

PRELIMINARY PROSPECTUS DATED OCTOBER 24, 2000 SUBJECT TO COMPLETION

WESTLINKS RESOURCES LTD.

150,000 SHARES OF COMMON STOCK

Six security holders are offering from time to time in open market
transactions up to 150,000 shares of common stock of Westlinks Resources Ltd. We
will not receive any proceeds from the sale of these shares.

By a separate prospectus concurrent with this offering Westlinks Resources
Ltd. is offering 1,000,000 shares of common stock and 1,000,000 common stock
purchase warrants, to be sold in units consisting of one share of common stock
and one warrant. Each warrant allows its holder to purchase for a period of six
months from the date of this prospectus one share of common stock for
US$ -- per share. The shares and warrants will trade separately after
issuance. We anticipate that the public offering price of the common stock will
be between US$4.50 and US$5.50 for each share, and US$0.25 for each warrant.

INVESTING IN OUR SECURITIES INVOLVES A HIGH DEGREE OF RISK. SEE "RISK
FACTORS" BEGINNING ON PAGE 7.

Prospectus dated -- , 2000
A-1
<PAGE> 82

ALTERNATE PAGE
PROSPECTUS SUMMARY

THE OFFERING

Information in this prospectus assumes an offering price of US$5.00 per
shares and US$0.25 per warrant. Except where noted otherwise, all information in
this prospectus, including share and per share information, assumes no exercise
of the underwriters' over-allotment option.

SECURITIES OFFERED BY THE
SELLING SECURITY HOLDERS: 150,000 shares of common stock issuable upon the
exercise of warrants held by the selling security
holders.

COMMON STOCK TO BE
OUTSTANDING AFTER THE
OFFERING: 5,582,639 shares.

USE OF PROCEEDS: We will not receive any proceeds from the sale of
these shares, but we received the exercise price
upon the exercise of the warrants. The shares of
common stock were issued upon the exercise by the
selling security holders of 150,000 warrants on
October 2, 2000 at US $4.00 per share. These
warrants were issued in connection with a bridge
loan to Westlinks. The proceeds from the exercise
of the warrants will be applied to our working
capital.

PROPOSED NASDAQ SMALLCAP
MARKET SYMBOLS: Common stock: WLKS; Warrants: WLKSW

CANADIAN VENTURE EXCHANGE
SYMBOL: Common stock: WLX

PINK SHEET SYMBOL: Common stock: WLKSF

A-2
<PAGE> 83

ALTERNATE PAGE
USE OF PROCEEDS

Westlinks will not receive any proceeds from the sale of shares of common
stock by the selling security holders, but we received the exercise price upon
the exercise of the warrants. The shares of common stock were issued upon the
exercise by the selling security holders of 150,000 warrants, each of which was
exercised on October 2, 2000 for one share of common stock at US$4.00 per share.
These warrants were issued in connection with a loan to Westlinks. The proceeds
from the exercise of the warrants was used to reduce bank debt and for working
capital. NASD members participating in Westlinks' public offering or the selling
security holder offering shall not receive compensation arising from the
exercise of such warrants.

A-3
<PAGE> 84

ALTERNATE PAGE
RESALE BY SELLING SECURITY HOLDERS

This prospectus relates to the proposed resale by the selling security
holders of up to 150,000 shares of common stock issued upon the exercise of
warrants held by the selling security holders on October 2, 2000. The following
table sets forth as of the date of this prospectus certain information
concerning the persons for whom Westlinks is registering the shares for resale
to the public. Westlinks will not receive any of the proceeds from the sale of
the shares, but received US$600,000 for the exercise of the warrants. None of
the selling security holders are officers, directors or 5% or greater
stockholders of Westlinks, except Patrick Williams Advisors.

<TABLE>
<CAPTION>
SHARES OF TOTAL SHARES OF
COMMON STOCK UPON COMMON STOCK SHARES OFFERED
SELLING SECURITY HOLDER EXERCISE OF WARRANTS OWNED(1) FOR RESALE
----------------------- -------------------- --------------- --------------
<S> <C> <C> <C>
Patrick Williams Advisors..................... 92,500 92,500 92,500
Glenn Russell................................. 20,000 35,500 20,000
F. Jack Wright................................ 15,000 25,000 15,000
William J. Gordica............................ 7,500 12,500 7,500
Lawrence W. Underwood......................... 7,500 38,300 7,500
Sapphire Capital Inc.......................... 7,500 7,500 7,500
</TABLE>

---------------
(1) Includes the shares of common stock issued upon the exercise of the
warrants.

The selling security holders may effect the sale of their shares from time
to time in transactions, which may include block transactions, in the open
market, in negotiated transactions, through the writing of options on the common
stock, or a combination of such methods of sale, at fixed prices which may be
changed, at market prices prevailing at the time of sale, or at negotiated
prices.

Westlinks is not aware of any agreements, undertakings or arrangements with
any underwriters or broker-dealers regarding the resale of its securities. The
selling security holders may effect such transactions by selling the shares, as
applicable, directly to purchasers or to or through broker-dealers who may act
as agents or principals. Such broker-dealers may receive compensation in the
form of discounts, concessions or commissions from the selling security holders,
and/or the purchasers of their shares, as applicable, for which such
broker-dealers may act as agents or to whom they sell as principal, or both,
which compensation as to a particular broker-dealer might be in excess of
customary commissions. The selling security holders and any broker-dealers that
act in connection with the sale of their shares might be deemed to be
"underwriters" within the meaning of section 2(11) of the Securities Act.

Westlinks has notified the selling security holders of the prospectus
delivery requirements for sales made by this prospectus and that, if there are
material changes to the stated plan of distribution, a post-effective amendment
with current information would need to be filed before offers are made and no
sales could occur until such amendment is declared effective.

A-4
<PAGE> 85

ALTERNATE PAGE
PLAN OF DISTRIBUTION

150,000 shares of common stock will be offered by the selling security
holders from time to time in market transactions at prevailing prices on the
[Nasdaq SmallCap Market], the Canadian Venture Exchange or a similar market.
Westlinks will not receive any proceeds from possible resale by the selling
securities holders of their respective shares of Westlinks' common stock.
Westlinks received gross proceeds of US$600,000 upon the exercise of the
warrants on October 2, 2000. NASD members participating in Westlinks' public
offering or the selling security holder offering, shall not receive compensation
arising from the exercise of such warrants. The selling security holders may
effect such transactions by selling their shares of common stock to or through
broker-dealers, and such broker-dealers may receive compensation in the form of
discounts, concessions or commissions from the selling security holders and/or
the purchasers of such shares of common stock for whom such broker-dealer may
act as agents or to whom they may sell as principals, or both. Any broker-dealer
selling securities offered by this Prospectus cannot receive compensation
(calculated as the difference between the purchase and resale price of the
securities) in excess of 8% on principal transactions or in excess of normal and
ordinary brokerage commissions, which, in any event may not exceed 5% of the
sale price, for any agency transactions. Westlinks has agreed to bear all
expenses estimated at approximately $10,000 in connection with the registration
of the shares of common stock to which this prospectus relates.

A-5
<PAGE> 86

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

Estimates of fees and expenses incurred or to be incurred by Westlinks in
connection with the issuance and distribution of securities being registered,
other than underwriting discounts and commissions, are as follows:

<TABLE>
<S> <C>
Securities and Exchange Commission registration fee....... $ 3,552
National Association of Securities Dealers filing fee..... 13,955
Canadian Venture Exchange Listing Application fee(1)...... 1,635
NASDAQ Listing Application fee............................ 10,000
State Securities Laws (Blue Sky) fees and expenses,
including legal fees.................................... 26,000
Transfer Agent's fees(1).................................. 3,400
Printing costs and fees(1)................................ 50,000
Legal fees and disbursements(1)........................... 100,000
Accounting fees and disbursements(1)...................... 24,000
Underwriter's expense allowance........................... 157,500
Miscellaneous expenses(1)................................. 39,958
--------
TOTAL..................................................... $430,000
========
</TABLE>

---------------
(1) Expenses to be paid in Canadian dollars have been estimated in U.S. dollars
on the basis of Canadian $1.00 = US$0.6773, being the exchange rate in
effect on June 12, 2000.

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS

The By-laws of Westlinks contain provisions whereby Westlinks has the
power, to the maximum extent permitted by the Business Corporations Act
(Alberta) ("ABCA"), to indemnify its officers and directors, former officers and
directors, or persons who act or acted at Westlinks' request as a director or
officer of a company of which Westlinks is a shareholder or creditor, and their
heirs and legal representatives, and to purchase and maintain insurance for the
benefit of any officers or directors, against any liability incurred in their
capacity as officers or directors of Westlinks, or as a director or officer of
such other company, as the case may be. The Company may also indemnify such
persons in such other circumstances as the ABCA permits.

The ABCA permits a corporation to indemnify its officers and directors,
former officers and directors, or persons who act or acted at Westlinks' request
as a director or officer of a company of which Westlinks is a shareholder or
creditor, and their heirs and legal representatives for their honest actions
taken in good faith and in the best interests of the corporation and, in the
case of criminal proceedings, such director or officer or other person had
reasonable grounds for believing that his conduct was lawful. The ABCA entitles
such persons to indemnification if the person seeking indemnity was
substantially successful on the merits of his defence of a legal proceeding,
acted honestly and in good faith with a view to the best interests of the
company, had reasonable grounds that his conduct was lawful and is fairly and
reasonably entitled to indemnity.

II-1
<PAGE> 87

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES

The Company is an Alberta, Canada corporation which has issued an aggregate
of 4,582,639 shares of common stock as follows:

(a) Effective at June 30, 1998, upon its amalgamation Westlinks issued
2,610,639 shares of common stock in exchange for the shares of the two
amalgamating companies, Temba Resources Ltd. and PTR Resources Ltd.. The stated
value of these shares was US$1,625,592 (C$2,470,880), being the stated capital
of the amalgamating companies. Westlinks also issued share purchase warrants to
purchase 310,000 shares of common stock on its amalgamation. These warrants were
not exercised and terminated on January 8, 2000(1).

(b) From November 1, 1998 through February 23, 2000, employee stock options
to purchase an aggregate total of 705,000 shares of common stock were granted to
directors, officers and employees of Westlinks, all residents of Alberta,
Canada(1).

(c) From March 22, 1999 through February 16, 2000, an aggregate total of
647,000 shares of common stock were issued upon the exercise of stock options
for aggregate proceeds of US$324,213 (C$492,800)(1)(2).

(d) From September 27 through December 16, 1999, 1,175,000 shares of common
stock were issued under a private placement sold to 19 residents of Alberta,
Canada at a subscription price of US$0.6579 (C$1.00) per share for proceeds of
US$773,033 (C$1,175,000)(1)(2).
---------------

Notes:

(1) None of these securities was registered under the Securities Act of 1933, as
amended (the "Securities Act") , having been issued in Canada in reliance
upon applicable Canadian regulations.

(2) All proceeds for the sale of securities, net of the expenses of the sales,
were used for general working capital.

(e) On June 5, 2000 warrants to purchase 150,000 shares of common stock
were issued in consideration for a loan to Westlinks by five residents of the
United States, who are accredited investors, in reliance upon Regulation D under
the Securities Act, and one resident of Alberta, Canada, in reliance upon
Regulation S under the Securities Act, as well as section 107(1)(d) of the
Securities Act of Alberta. Each warrant may be exercised for one share of common
stock at an exercise price of US$4.00 through March 5, 2001. All 150,000
warrants were exercised on October 2, 2000 for proceeds of US$600,000
($C912,000). The resale of the common stock underlying the warrants is being
registered hereunder. Following are the six lenders and the number of warrants
issued to each:

<TABLE>
<CAPTION>
NO. OF
NAMES OF LENDERS WARRANTS
---------------- --------
<S> <C>
Patrick Williams Advisors(1)................................ 92,500
Glenn Russell............................................... 20,000
F. Jack Wright.............................................. 15,000
Lawrence W. Underwood....................................... 7,500
Sapphire Capital Inc.(2).................................... 7,500
William J. Gordica.......................................... 7,500
</TABLE>

---------------
(1) Patrick Williams Advisors is a general partnership owned as to 50% each by
John P. McGrain and Georgette Pagano.

(2) Sapphire Capital Inc. is owned by Lawrence W. Underwood.

II-2
<PAGE> 88

ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(A) EXHIBITS

<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
----------- -----------
<C> <S>
#**1.1 Form of Underwriting Agreement.

#**1.2 Form of Agreement among Underwriters.

**2.1 Amalgamation Agreement dated May 27, 1998 between Temba
Resources Ltd. and PTR Resources Ltd. pursuant to which the
Registrant was amalgamated under the Business Corporations
Act (Alberta) on June 30, 1998.

**2.2 Letter Agreement dated August 12, 1999 pursuant to which the
Registrant acquired all of the issued and outstanding shares
of 759795 Alberta Ltd.

**2.3 Notice of Intention to File a Normal Course Issuer Bid.

**3.1 Certificate of Amalgamation and attached Articles of
Amalgamation of the Registrant dated and filed June 30,
1998.

**3.2 By-laws of the Registrant.

*4.1 Form of Purchase Warrant Trust Indenture dated -- ,
2000 between the Registrant and Computershare Corporate
Services providing for the issuance of the Warrants.

#**4.2 Form of Warrant Agreement dated -- , 2000 between the
Registrant and [THE UNDERWRITERS] providing for the issuance
of the Underwriters' Warrants.

#**5.1 Opinion and Tax Opinion of Gowling Lafleur Henderson LLP.

**10.1 Credit Facility Letter Agreement between the Alberta
Treasury Branches and the Registrant as Borrower dated April
19, 2000.

**10.2 Promissory Notes dated June 5, 2000 granted by Westlinks to
each of Glenn Russell, Patrick Williams Advisors, William J.
Gordica, F. Jack Wright, Lawrence W. Underwood and Sapphire
Capital Inc.

**10.3 Purchase and Sale Agreement dated April 6, 2000 between
Cabre Exploration Ltd. and the Registrant.

*10.4 Purchase and Sale Agreement dated October -- , 2000 between
the Registrant and Compton Petroleum Corporation.

**13.1 Audited Financial Statements of the Registrant for the
fiscal year ended December 31, 1999.

**13.2 Financial Statements of the Registrant for the first quarter
ended March 31, 2000.

#13.3 Financial Statements of the Registrant for the second
quarter ended June 30, 2000.

**21.1 List of Subsidiaries of the Registrant.

#**23.1 Consent of Gowling Lafleur Henderson LLP (included in
Exhibit 5).

**23.2 Consent of Collins Barrow.

**23.3 Consent of Grant Trimble Engineering Ltd.

#23.4 Consent of KPMG LLP

**24.1 Powers of Attorney (included on signature page).
</TABLE>

---------------

* To be filed by further amendment.

** Previously filed with this registration statement.

# Filed with this amendment or amended with this filing.

II-3
<PAGE> 89

ITEM 17. UNDERTAKINGS

The undersigned Registrant hereby undertakes as follows:

(1) To provide to the underwriters at the closing specified in the underwriting
agreement certificates in such denominations and registered in such names as
required by the underwriters to permit prompt delivery to each purchaser.

(2) Insofar as indemnification for liabilities arising under the Securities Act
of 1933, as amended (the "Act"), may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the provisions described
in Item 14, or otherwise, the Registrant has been advised that in the
opinion of the Securities and Exchange Commission, such indemnification is
against public policy as expressed in the Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of Registrant in the
successful defence of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities
being registered, the Registrant will, unless in the opinion of its counsel
the matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the
final adjudication of such issue.

(3) For purposes of determining any liability under the Act, the information
omitted from the form of prospectus filed as part of this Registration
Statement in reliance upon Rule 430A and contained in a form of prospectus
filed by the Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under
the Act shall be deemed to be part of this Registration Statement as of the
time it was declared effective.

(4) For the purpose of determining any liability under the Act, each
post-effective amendment that contains a form of prospectus shall be deemed
to be a new Registration Statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof.

(5) (a) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:

(i) to include any prospectus required by section 10(a)(3) of the Act,
unless the information required to be included in such
post-effective amendment is contained in periodic reports filed by
the Registrant pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 that are incorporated herein by reference;

(ii) to reflect in the prospectus any facts or events arising after the
effective date of this Registration Statement (or the most recent
post-effective amendment thereof) which, individually or together,
represent a fundamental change in the information set forth in
this Registration Statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered hereby (if
the total value of securities offered would not exceed that which
was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to rule 424(b) if,
in the aggregate, the changes in volume and price represent no
more than a 20% change in the maximum aggregate offering price set
forth in the "Calculation of Registration Fee" table in the
effective registration statement;

(iii) to include any material information with respect to the plan of
distribution not previously disclosed in this Registration
Statement or any material change to such information in this
Registration Statement.

(b) For the purpose of determining any liability under the Act, each such
post-effective amendment shall be deemed to be a new Registration
Statement relating the securities offered herein, and the offering of
such securities at that time shall be deemed to be the initial bona
fide offering thereof.

II-4
<PAGE> 90

(c) To remove from registration by means of a post-effective amendment any
of the securities that remain unsold at the termination of the
offering.

(d) To file a post-effective amendment to this Registration Statement to
include any financial statements required by Rule 3-19 of Regulation
S-X at the start of any delayed offering or throughout a continuous
offering. The financial statements and information otherwise required
by Section 10(a)(3) of the Act need not be furnished, provided that
the Registrant includes in the prospectus, by means of a
post-effective amendment, financial statements required pursuant to
this paragraph (d) and other information necessary to ensure that all
other information in the prospectus is at least as current as the date
of these financial statements.

II-5
<PAGE> 91

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant
has caused this Amendment to its Registration Statement to be signed on its
behalf by the undersigned, in the City of Calgary, Province of Alberta, Canada,
on October 24, 2000.

WESTLINKS RESOURCES LTD.

/s/
By: ----------------------------------
Peter R. Sekera
President and
Chief Executive Officer

Pursuant to the requirements of the Securities Act of 1933, this Amendment
to Registration Statement has been signed by or on behalf of the following
persons in the capacities indicated on October 24, 2000.

<TABLE>
<CAPTION>
NAME CAPACITY
---- --------
<C> <S>
/s/ President and Chief Executive Officer, and Director
------------------------------------------ (Principal Executive Officer)
Peter R. Sekera

/s/ Vice-President, Finance
------------------------------------------ (Principal Financial Officer and Principal Accounting
Lynn W. Thurlow Officer)

/s/ Executive Vice-President; Chief Operating Officer, and
------------------------------------------ Director
Edward C. McFeely

/s/ Vice-Chairman, and Director
------------------------------------------
Thomas J. Jacobsen

/s/ Director
------------------------------------------
H.S. (Scobey) Hartley

/s/ Director
------------------------------------------
Norman J. MacKenzie

/s/ Director
------------------------------------------
Norman W.G. Wallace

/s/ Authorized Representative in the United States
------------------------------------------
Thomas N. Dirks
</TABLE>

II-6
<PAGE> 92

Amendment No. 1
---------------

EXHIBIT NO. EXHIBIT INDEX
----------- -------------
#**1.1 Form of Underwriting Agreement.

#**1.2 Form of Agreement among Underwriters.

**2.2 Letter Agreement dated August 12, 1999 pursuant to which the
Registrant acquired all of the issued and outstanding shares
of 759795 Alberta Ltd.

**2.3 Notice of Intention to File a Normal Course Issuer Bid.

**3.1 Certificate of Amalgamation and attached Articles of
Amalgamation of the Registrant dated and filed June 30,
1998.

**3.2 By-laws of the Registrant.

*4.1 Form of Purchase Warrant Trust Indenture dated -- , 2000
between the Registrant and Computershare Corporate Services
providing for the issuance of the Warrants.

#**4.2 Form of Warrant Agreement dated -- , 2000 between the
Registrant and [the Underwriters] providing for the issuance of
the Underwriters' Warrants.

#**5.1 Opinion and Tax Opinion of Gowling Lafleur Henderson LLP.

**10.1 Credit Facility Letter Agreement between the Alberta
Treasury Branches and the Registrant as Borrower dated April
19, 2000.

**10.3 Purchase and Sale Agreement date April 6, 2000 between Cabre
Exploration Ltd. and the Registrant.

*10.4 Purchase and Sale Agreement date October -- , 2000 between the
Registrant and Compton Petroleum Corporation.

**13.1 Audited Financial Statements of the Registrant for the fiscal year
ended December 31, 1999.

**13.2 Financial Statements of the Registrant for the first quarter ended
March 31, 2000.

#13.3 Financial Statements of the Registrant for the second quarter
ended June 30, 2000.

**21.1 List of Subsidiaries of the Registrant.

#**23.1 Consent of Gowling Lafleur Henderson LLP (included in Exhibit
5.1).

**23.2 Consent of Collins Barrow.

**23.3 Consent of Grant Trimble Engineering Ltd.

#23.4 Consent of KPMG LLP.

**24.1 Powers of Attorney (included on signature page).

---------------
* To be filed by further amendment.
** Previously filed with this registration statement.
# Filed with this amendment or amended with this filing.