PetroNeft 2010 final results

May 11, 2011

PetroNeft Resources plc

Preliminary Results for the Year Ended 31 December 2010

2010 – A Transformational Year

11 May 2011

PetroNeft Resources plc (“PetroNeft”, “the Company” or “the Group”), (AIM: PTR) owner and operator of Licences 61 and 67, Tomsk Oblast, Russian Federation, is pleased to report its preliminary results for the year ended 31 December 2010.

Operational Highlights

  • Year-round production commenced on schedule in Q3 2010
  • Group 2P reserves increase 37% to 96.9 mmbbls
  • Production reached 3,100 bopd from 9 wells
  • Drilling of 17 additional production wells planned for 2011 underway
  • Five well exploration programme targeting 120 million barrels of reserves underway

Financial Highlights

  • Commencement of oil sales in late Q3 2010
  • Capital expenditure of US$42 million in 2010; a fully-funded US$53 million spend planned for 2011
  • Successful oversubscribed US$43 million equity placing in October 2010
  • Macquarie US$30 million Loan facility signed in May 2010, improved terms agreed in April 2011

Dennis Francis, CEO of PetroNeft commented:

“2010 was a transformational year which saw PetroNeft evolve from an exploration company to one with both exploration and production. Our proved and probable oil reserves grew by 37% with the addition of two new oil fields to our portfolio.

“2011 is set to be PetroNeft’s busiest year to date with production continuing to grow on the back of 17 new production wells and 120 million barrels of reserve growth targeted by a major five well exploration programme both of which are already underway. We look forward to updating shareholders on progress on both fronts throughout the year. ”

Final Results for the Year Ended 31 December 2010

For further information, contact:

Dennis Francis, CEO, PetroNeft Resources plc

+1 713 988 2500

Paul Dowling, CFO, PetroNeft Resources plc

+353 1 647 0280

John Frain/Brian Garrahy, Davy (NOMAD and Joint Broker)

+353 1 679 6363

Charles Berkeley/Henry Fitzgerald-O’Connor, Canaccord Genuity Limited (Joint Broker)

+44 207 050 6500

Martin Jackson, Citigate Dewe Rogerson

+44 207 638 9571

Joe Murray/Ed Micheau, Murray Consultants

+353 1 498 0300

Forward Looking Statements

This announcement contains forward-looking statements. These statements relate to the Company's future prospects, developments and business strategies. Forward-looking statements are identified by their use of terms and phrases such as 'believe', 'could', 'envisage', 'potential', 'estimate', 'expect', 'may', 'will' or the negative of those, variations or comparable expressions, including references to assumptions.

The forward-looking statements in this announcement are based on current expectations and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by those statements. These forward-looking statements speak only as at the date of this announcement.


1P Proved reserves according to SPE standards.

2P Proved and probable reserves according to SPE standards.

3P Proved, probable and possible reserves according to SPE standards.

AGM Annual General Meeting.

bfpd Barrels of fluid per day.

bopd Barrels of oil per day.

IAS International Accounting Standard.

IFRIC IFRS Interpretations Committee.

IFRS International Financial Reporting Standard.

km Kilometres.

m Metres.

mmbbls Million barrels.

mmbo Million barrels of oil.

P1 Proved reserves according to SPE standards.

P2 Probable reserves according to SPE standards.

P3 Possible reserves according to SPE standards.

PetroNeft PetroNeft Resources plc.

Stimul-T Limited Liability Company Stimul-T, a wholly owned subsidiary of PetroNeft, based in the Russian Federation.