Petrolifera Reports 75% Boost in Proved Reserves

Petrolifera Petroleum Limited said its total proved oil reserves ("1P") increased by 75 percent to 10.5 million barrels during 2006 compared to estimates of six million barrels at December 31, 2005. This was achieved after sales during 2006 of 2.2 million barrels, indicating a reserve replacement ratio for crude oil of 307 percent (proved or 1P only). On an equivalent basis, converting natural gas to barrels of oil equivalent on a 6 Mcf/1 barrel basis, the reserve replacement ratio increases to 385 percent after equivalent production of 2.3 million boes in 2006.

Readers are cautioned that the conversion used in calculating barrels of oil equivalent (6 mcf:1 bbl) is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Furthermore, boes may be misleading if used in isolation. Also, estimations of reserves and future net revenue to be discussed in this press release constitute forward-looking statements.

The reserve estimates at year end 2006 were prepared by GLJ Petroleum Consultants ("GLJ"), independent petroleum engineers of Calgary, Alberta. Their report ("GLJ Report") was prepared using assumptions and methodology guidelines outlined in the Canadian Oil and Gas Evaluation Handbook ("COGE Handbook") and in accordance with National Instrument 51-101 ("NI51-101"). Prior reports for Petrolifera were prepared by DeGolyer and MacNaughton Canada Limited ("D&M") and comparisons provided herein are to items contained in a report ("D&M Report") with an effective date of December 31, 2005. The D&M Report was also prepared in accordance with the COGE Handbook and NI51-101.

The GLJ Report estimates Petrolifera's total proved natural gas reserves at December 31, 2006 to be 14.3 Bcf, an increase of 409 percent over year end 2005 estimates.

On a boe basis, Petrolifera's estimated total proved reserves (1P) increased 99 percent to 12.9 million boe compared to 6.5 million boe last year, again after production of 2.3 million boe during 2006.

The GLJ Report estimates Petrolifera's year end 2006 total proved and probable ("2P") crude oil reserves to be 19.5 million barrels and 2P natural gas reserves to be 28.8 Bcf. On an equivalent basis, total 2P reserves were estimated to be 24.3 million boe, an increase of five percent over the D&M estimate at year end 2005, after production of 2.3 million boe during 2006.

Using GLJ's December 31, 2006 escalated price and cost forecast, the GLJ Report estimates that the 2P reserves will generate future pre-tax net revenue of $630 million over the forecast life of the properties, after deduction of related operating costs, royalties, forecast capital expenditures of $45.3 million and abandonment costs, but before deduction of indirect charges, including corporate overhead. This net revenue stream is estimated to have a 10 percent present worth of $449 million.

More detailed summaries of the company's year end GLJ Report will be contained in its 2006 Annual Report and 2006 Annual Information Form. Petrolifera is preparing these documents, which will include customary year end material, for distribution or filing near the end of March 2007.

Petrolifera is a public Canadian oil and natural gas exploration and production company with activities in Argentina, Peru and with plans to commence operations in Colombia. All of its reserves and production is located in its 100 percent owned and operated Puesto Morales/Rinconada Concession in the Neuquen basin, Argentina.