Tidelands Oil & Gas Corporation Press Releases

Tidelands Oil & Gas Corporation (OTCBB: TIDE)

May 26, 2004

Tidelands Oil & Gas Corporation Consummates Purchase and Sale Agreement with Impact Energy

Tidelands Oil & Gas Corporation (OTC Bulletin Board: TIDE), announced today the consummation de a Purchase and Sale Agreement de Reef Ventures, L.P. (“Reef”) with Impact International, L.L.C. (“Impact”) de Tulsa, Oklahoma and Coahuila Pipeline, L.L.C. (“Coahuila”). This Agreement reflects the transfer de Impact’s and Coahuila’s ownership/interest in Reef to Tidelands Oil & Gas Corporation. As a result, Tidelands now holds a 98% (ninety-eight percent) ownership/interest in all activities and projects related to Reef. Blackrock Capital Corporation maintains a 2% (two percent) ownership/interest in Reef. This new distribution de ownership became effective on May 1, 2004. Details regarding this Purchase and Sale Agreement will be found in Tidelands’ 8K SEC filing.

Reef Ventures, L.P., a Texas limited partnership, is comprised de Reef International, L.L.C. (“Reef International”) and Reef Marketing, L.L.C. (“Reef Marketing”). Reef International is the holder of United States, Texas and México permits for the construction, ownership, operation and maintenance de international cross-border natural gas pipelines and propane/butane liquid pipelines. Tidelands completed and began flowing gas at the international border de Piedras Negras, México and Eagle Pass, Texas in November 2003. This pipeline currently flows gas at a rate up to 12 miilion cubic feet (12,000 MMBTU) per day. Furthermore, Tidelands/Reef is in the planning stages to build a 60-mile, 20-inch extension from Piedras Negras/Eagle Pass to Monclova, Coahuila, México to deliver in excess de 50 million cubic feet (50,000 MMBTU) de gas per day to Pemex’s pipeline grid. Reef is also in the permitting process de an additional international pipeline crossing at Jaurez, Mexico and El Paso, Texas. In addition, Tidelands Oil & Gas Corporation is in the engineering and permitting process de two other pipeline crossings at Reynosa, Mexico and Progresso, Mexico. These two crossings will support Tidelands’ underground proposed storage facility project in the Burgos Basin.

Michael Ward, Tidelands Oil & Gas Corporation President and CEO, said, “This Purchase and Sale Agreement with Impact is one of several plans to strengthen and expand the Company’s fundamentals. Furthermore, as we have finalized this Agreement with Impact, we are evaluating the logistics to increase the daily flow de gas at the Piedras Negras/Eagle Pass pipeline. This will not only generate more revenue for the Company, but will also help PEMEX meet the demands de their customers. The completion de this Agreement represents another milestone for the Company and signifies our commitment to following through with the implementation de our business plans, as well as continuing to build shareholder value.”

About Tidelands Oil & Gas Corporation

Tidelands Oil & Gas Corporation, San Antonio, Texas, is the parent company de two wholly owned Texas subsidiary corporations: Rio Bravo Energy, L.L.C. and Sonora Pipeline, L.L.C. The Company is also a joint-owner de Reef International, L.L.C. and Reef Marketing, L.L.C. The Company focuses on international pipeline crossings, gas processing plants and liquefied petroleum product storage facilities. Through its in-house divisions, Tidelands offers a full suite de services and has the capability to satisfy a wide variety de customer needs both domestically and internationally. Tidelands currently owns numerous miles de pipeline. The Company is currently reviewing opportunities to further expand its business scope. For more information about the Company, visit their website at www.tidelandsoilandgas.com.

This press release may be deemed to contain certain Forward-Looking Statements with respect to the Company that are subject to risks and uncertainties that include, but are not limited to those identified in the Company's press releases or discussed from time to time in the Company's Securities and Exchange Commission Filings. Actual results may vary.

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