PetroNeft Encouraged by Early Tungolskoye Results

PetroNeft Resources plc--100% owner of Stimul-T, which is the sole owner and operator of License 61 in Tomsk Oblast, Russian Federation—on Tuesday issued an update on the progress on its 2006/07 three-well drilling program.

Tungolskoye No. 4 Well The Tungolskoye Oil Field is located in License 61 in the Tomsk Region of the prolific Western Siberian Oil and Gas Basin. Discovered in 1973, Ryder Scott petroleum consultants estimate 2P reserves of 17.92 million barrels of oil for the field.

--The Tungolskoye No. 4 well was spudded on 16 May 2007 and reached Total Depth of -2,900 meters subsea on 15 June.
--Oil was confirmed in the primary reservoir interval comprising over 15 meters of continuous net pay in the Upper Jurassic Vasugan Formation. This represents the single best reservoir interval drilled to date on License 61. The entire reservoir interval was successfully cored and these cores are currently being analyzed in detail.
--The Base Bazhenov Formation was penetrated at -2,505 meters subsea, which is in good agreement with the seismic interpretation prior to drilling the well. The data indicates that the oil water contact (owc) is consistent with the current field wide owc at -2,526 meters subsea.
Geophysical logging and initial petrophysical analysis has now been completed and preparations are now underway to carry out flow tests on the well to determine its productive capacity. Results will be published as soon as they are available.

Lineynoye and Tungolskoye Drilling Program

The current appraisal drilling program that comprises two wells, the recently completed Lineynoye No. 6 well and Tungolskoye No. 4, is designed to confirm prior reservoir data in the Lineynoye and Tungolskoye fields and to provide further input into a Final Development Feasibility Study. The program also includes a high impact exploration well, Lineynoye No. 7, on the West Lineynoye Prospect. These results will also be incorporated into the Final Development Feasibility Study expected to be completed in late 2007.

West Lineynoye Prospect - Lineynoye No. 7 Well

The Lineynoye No. 7 Well was spudded on 18 June 2007. West Lineynoye, a high impact prospect, is estimated by Ryder Scott to contain Possible Reserves of approximately 67 million barrels of oil. The principal target horizons for this well are Upper Jurassic sandstone reservoirs starting at a depth of about -2,375 meters subsea. The total planned depth for the well is approximately -2,750 meters and it is anticipated that the well will be drilled, logged and tested within approximately 70 days of commencement.

Dennis Francis, Chief Executive Officer of PetroNeft Resources plc, commented:

"We are delighted with the initial results from the Tungolskoye No. 4 well. This result confirms the presence of a significant and continuous reservoir interval and supports the current structural and hydrodynamic interpretation of the field.

"The 15.2 meters of continuous net pay represents the single best reservoir interval drilled to date in the License area and is an important input into our ongoing development and production feasibility planning work.

"We look forward to positive flow test results from Tungolskoye No. 4 and the drilling of Lineynoye No. 7 which could bring significant new reserves into our portfolio."