GX Guardian Exploration Inc

Guardian Exploration Inc. (TSX VENTURE:GX) ("Guardian") is pleased to announce
that it has entered into a letter of intent (the "Letter of Intent") with
respect to a proposed business combination (the "Business Combination") of
Guardian and Luxor Oil & Gas Inc. ("Luxor"), an Alberta based private oil and
gas company. The resulting issuer following the Proposed Business Combination is
herein referred to as "Newco". 


About the Business Combination 

Guardian and Luxor have agreed to combine their businesses to form a new oil and
natural gas exploration and development company which will continue under a name
that is to be determined. The Letter Agreement contemplates that Guardian and
Luxor will, with the assistance of their respective professional advisers,
determine a transaction structure for the Business Combination. Representatives
of Guardian and Luxor expect to finalize the transaction structure for the
Business Combination and enter into a formal agreement on or prior to September
30, 2009, at which time Guardian and Luxor expect to issue a further press
release setting out additional details concerning the Business Combination. 


For purposes of the Business Combination, it is anticipated that with respect to
Guardian, the outstanding common shares of Guardian ("Guardian Shares")
(including Guardian Shares issued on exercise or conversion of Guardian's issued
and outstanding convertible securities subsequent to the date hereof and prior
to the effective date of the Business Combination) will be exchanged for such
number of common shares ("Newco Shares") of the resulting company after
completion of the Business Combination ("Newco") as will reflect a net value of
Guardian equal to $500,000 (the "Guardian Exchange Ratio"), subject to
adjustment based upon the due diligence review of Guardian to be completed by
Luxor. 


For purposes of the Business Combination, it is anticipated that with respect to
Luxor, the outstanding common shares of Luxor ("Luxor Shares") (including Luxor
Shares issued on exercise or conversion of Luxor's issued and outstanding
convertible securities subsequent to the date hereof and prior to the effective
date of the Business Combination) will be exchanged for such number of Newco
Shares as will reflect a net value of Luxor equal to $700,000 (inclusive of the
Luxor Share Financing, as defined below) (the "Luxor Exchange Ratio"), subject
to adjustment based upon the value of Luxor at closing. The value of Luxor will
be based on the independent valuation of Luxor oil and gas reserves (based on
proven plus one-half probable reserves at 15% discount to constant dollar
values) and net positive working capital of Luxor at Closing. 


Further, pursuant to the Business Combination, holders of Luxor Shares will
receive an option whereby if certain payables of Guardian, which are considered
to be inactive, become active within 12 months following closing of the Business
Combination ("Renewed Payable Claims"), the shareholders of Luxor will have an
option to receive additional Newco Shares equal to the amount of the Renewed
Payable Claims multiplied by the Luxor Exchange Ratio at an exercise price of
$0.01 per Newco Share. 


Other than as described below, all unexercised options and warrants to purchase
Guardian Shares or Luxor Shares will either be exercised prior to the effective
date of the Business Combination or will continue as Newco options or warrants
for the purchase of Newco Shares. 


It is contemplated that the board of directors of the Newco will consist of five
members, including Wally Pollock and Issa Abu-Zahra, current directors of Luxor,
and Scott Reeves, a current director of Guardian, along with two additional (2)
nominees of Luxor. Mr. Pollock will also be appointed President and Chief
Executive Officer of Newco and Mr. Abu-Zahra will be appointed the
Vice-President, Operations. Additional officers of Newco, including a Chief
Financial Officer, are expected to be identified prior to the completion of the
Business Combination. Newco will also adopt an incentive stock option plan in
accordance with the policies of TSX Venture Exchange (the "Exchange") providing
for a pool of stock options to be not less than 10% of the issued and
outstanding shares of Newco, and such options will be granted to the management
and board of directors of Newco as determined by the board of directors of Newco
following closing of the Business Combination. 


The Business Combination is an arms' length transaction as none of the directors
or officers of Luxor have any interest whatsoever in Guardian. 


Prior to Closing, Luxor will complete a private placement financing involving
the issuance of units, each unit consisting of one Luxor Share and one purchase
warrant, at a price not less than $0.85 per unit, with each purchase warrant
being exercisable into one Luxor Share at a purchase price of $0.85 per Luxor
Share for a period of 24 months following closing (the "Luxor Share Financing").



Also prior to Closing, Luxor will also complete a private placement financing
involving the issuance of Luxor convertible debentures, convertible into Newco
Shares at a price not less than $0.0125 per share, for gross proceeds of
$800,000 (the "Luxor Debenture Financing"). 


Concurrently with the Closing of the Business Combination, Graydon Kowal,
President and Chief Executive Officer of Guardian ("Kowal") will (a) return to
Guardian for cancellation 7.3 million Guardian Shares beneficially held by him;
(b) execute an escrow agreement in a form suitable to Luxor and Guardian placing
2 million Guardian Shares owned by Kowal into escrow; (c) execute a settlement
agreement settling all employment matters including, but not limited to, any
severance and bonus entitlements for the sum of $1; and (d) agree to the
cancellation of all option of Guardian held by him. In exchange, Guardian will
agree to transfer to Kowal at Closing its 100% shareholding in its wholly-owned
subsidiary, K2 America Corp. and grant to Kowal an option to repurchase the oil
and gas interests owned by Guardian in the Gunnel area of British Columbia for
an option price equal to $1, which option will terminate if an economic oil or
gas well has been drilled and tested by Luxor or its farm-in or joint venture
partner on or before December 31, 2012 (collectively, the "Kowal Obligations"). 


Completion of the Business Combination is subject to a number of conditions in
favor of Guardian and Luxor, respectively, including the execution and delivery
of a formal agreement, board approval of such formal agreement, completion of
satisfactory due diligence inquiries, receipt of all necessary regulatory
approvals (including the consent of the Exchange), receipt of third party
approvals, approval of the shareholders of Guardian and Luxor, Guardian having a
working capital deficit at Closing of not greater than $400,000 (net of
Guardian's $1.8 million flow through obligation and abandonment liabilities),
Guardian having net production from its wells located in the Girouxville area of
Alberta not less than an average of 115 bbls/day for the 60 days prior to August
31, 2009, the settlement by Guardian of all of its management contract
liabilities prior to Closing, Guardian having unexpended flow through share
contractual commitments of not greater than $1,800,000 at Closing, Luxor having
working capital at Closing of not less than $200,000 (including the Luxor Share
Financing, but not including the Luxor Debenture Financing), the completion of
the Luxor Debenture Financing for proceeds of not less than $800,000, the Kowal
Obligations being satisfied, and a threshold for the exercise of dissent rights
(10%) not being exceeded (if the Business Combination is structured in such a
manner as to give rise to statutory dissent rights). There is no assurance that
these conditions will be satisfied and the Business Combination will be
completed. 


Information about Guardian Exploration Inc. 

Guardian Exploration Inc. is an Alberta-based oil and natural gas company.
Guardian is engaged in the exploration for, and the acquisition, development and
production of, natural gas and crude oil with emphasis on the shallow to
mid-depth hydrocarbon prone zones of the western Canadian sedimentary basin in
Alberta and northeastern British Columbia. 


Investors are cautioned that this news release contains forward looking
information. Such information is subject to known and unknown risks,
uncertainties and other factors that could influence actual results or events
and cause actual results or events to differ materially from those stated,
anticipated or implied in the forward-looking information. Readers are cautioned
not to place undue reliance on forward-looking information, as no assurances can
be given as to future results, levels of activity or achievements.

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