MegaWest Energy Corp., a Calgary based oil and gas company, specializing in non-conventional oil and gas projects with a focus on North American heavy oil, announces the commencement of an eight well drilling program at its Kentucky Reserves Project by its wholly-owned subsidiary, MegaWest Energy USA Corp.

MegaWest has initiated the drilling of eight exploration wells at various strategic locations across the 29,800 acres of Kentucky Reserves lands in which the company holds a 62.5% working interest. The objective of this drilling program is to confirm the commercial prospectivity of three Mississippian heavy oil pay zones found at depths of 200-600 feet from surface.

As of August 13, two of the eight wells had been drilled to planned total depths. Over 50 feet of core was obtained from each well over the Big Clifty formation which is the primary target. Analysis of the drill cuttings has confirmed the presence of all three pay zones in each well and indicates 77 feet and 85 feet of hydrocarbon bearing formation respectively was encountered in these two wells. These initial drilling results confirm MegaWest’s geological model and provide further confirmation of the Project’s significant potential for commercial production.

Upon completion of the drilling program, the cores and log data will be shipped to Calgary for detailed evaluation and analysis. Once all of the data has been analyzed, MegaWest will initiate a more focused delineation and development drilling program at the Kentucky Reserves Project, which will then be followed by the installation of surface facilities to conduct a pilot production test beginning in early 2008.

In addition, the Company expects to begin its exploratory drilling programs at its Deerfield Project (Missouri) and the Trinity Sands Project (Texas) within the next 4-6 weeks. MegaWest’s $26,000,000 Capital & Operating Budget for 2007-08 provides for the drilling of a total of 18 exploration wells and 130 development wells among the Company’s Projects.