Over the last several years a growing geological, geophysical and drilling database has been generated for the project area. The Company, as operator, has been focused on a geological analysis of this information towards optimizing a drilling program for the Flat Bay area. In particular, the 2010 seismic data has been incorporated into the geological understanding of the basin and its petroleum system. As a result, a drilling program on the shallow Flat Bay oil deposit is planned to accomplish three objectives. First, to delineate the areal extent of the oil deposit towards evaluating the oil-in-place resource. Secondly, to potentially locate areas within the deposit that are naturally fractured with resulting enhanced permeability; and, thirdly to test the down dip potential extension of the oil deposit in a south-southeast direction. The results of this program will assist the joint venture in determining the development strategies that may be viable for the deposit. The first two objectives will be accomplished by a shallow coring program consisting of 3 - 5 holes. The third objective will be met by a well to a depth of approximately 1000 metres (Journois location), subject to positive coring results. The core holes will span an area of approximately 4 kilometres from north to south and 2 kilometres east to west centered around the Flat Bay #1 discovery hole. The Journois location is approximately 4 kilometres from Flat Bay #1.

The permitting process to carry out these operations has commenced with the submission of relevant applications to the provincial government regulators. Procurement of goods and services has also commenced. It is the Company's plan to commence field operations as soon as permitting and procurement are completed and to utilize its own drill rig, capable of drilling to 1000 metres for the drilling of the Journois location. This is expected to be a late summer- fall program. The Company and its partner have agreed on a budget and have sufficient funds to carry out this exploration program.

In order to better appreciate the oil distribution and reservoir parameters within the Flat Bay oil deposit the Company has posted laboratory analysis and photos of previous Flat Bay core holes on its website at www.vulcanminerals.ca. These data demonstrate the significant oil saturations within the Spout Falls conglomerate/sandstone and the Ship Cove limestone.

Flat Bay core hole #2 has measured oil saturations ranging from less than 1% up to 76% and Flat Bay core hole #3 has oil saturations ranging from less than 10% up to 52%. Saturation numbers are based on 15 random samples over a 170 metre core length in core hole #2 and 15 random samples over a 50 metre core length in core hole #3. The analysis was carried out by Weatherford Laboratories.

Offshore Labrador

The Company owns a 30% working interest in EL1107 in the Hopedale basin, offshore Labrador. Investcan Energy Corporation is the operator with a 70% working interest. In late 2010 the joint venture acquired approximately 3000 line kilometres of 2D seismic data over the licence to enhance prospect identification. The interpretation of this data should be complete by mid summer. Following an assessment of this interpretation, the partners will decide upon a strategy for advancing further exploration on the licence. It is noteworthy that additional lands have been posted for a Call for Bids by the Canada-Newfoundland and Labrador Offshore Petroleum Board (CNLOPB) in the offshore Labrador area. Four parcels have been posted approximately 400 kilometres north of the Company's licence. Combined with the heightened level of drilling activity offshore western Greenland, the Company is optimistic that the offshore Labrador area will receive further renewed exploration in light of the large reserve potential of the area. This potential is typified by EL1107 which is undrilled and lies along trend between the Bjarni North Bjarni discovery to the north (approximately 3.1 trillion cubic feet of natural gas) and the Grudrid discovery (924 billion cubic feet of natural gas) to the southeast. These gas quantities are resources as published by the CNLOPB.

Vulcan is a diversified junior exploration company focused on petroleum exploration in the under-explored Bay St. George basin in western Newfoundland and also holds mineral interests in areas strategic to its operations in Newfoundland and Labrador.