News & ASX Releases

Po Valley Increases Italian Energy Interests

October 30, 2006

Australian petroleum explorer, Po Valley Limited (“PVE”) has increased its footprint on the highly attractive Italian energy market.

Po Valley announced today it had been awarded the rights to proceed forward on an exclusive basis with five new gas and oil exploration licences applications in Italy — the main focus for the Australian company’s exploration and production operations.

The additional licences cover a total area of 1,610 square kilometres and are all contained to petroleum provinces in northern Italy where Po Valley has focused it’s development options. “This is a major increase in the size and depth of our Italian portfolio,” Po Valley’s Chief Executive Officer, Mr Michael Masterman, said today.

“The new applications provide Po Valley with the potential to delineate new gas/oil fields to build on the drill and imminent production successes of our first three projects — Sillaro, Vitalba and Santa Maddalena - which were the subject of our prospectus two years ago,” Mr Masterman said.

“The new assets provide the Company with some exciting large-scale exploration projects within the dynamics of northern Italy which we identified as the most prospective for near term development and early production into the high demand Italian and European energy markets.” Under the terms of the licence award, the Italian Hydrocarbon Commission has advised that Po Valley can proceed forward on an exclusive basis with 5 major new licence applications in northern Italy.

The five licence applications are “Ossola” and “Opera” located near Milan and “La Prospera:, “Podere Gallina” and “La Risorta” located near Bologna. Based on the work initiated by Po Valley to date, the licence areas contain 8 new gas prospects and 2 new oil exploration targets.

The Ossola licence lies to the north of Milan, and on preliminary evaluations, contains two large gas/oil exploration targets. Po Valley plans early acquisition of seismic data to further investigate these structures.

Opera is to the east of Milan, near Po Valley’s Cascina san Pietro licence which holds the successfully drilled Vitalba and the soon to be drilled Bezzecca gas development project. The Company has identified 2 attractive gas prospects in the Opera licence area.

La Prospera, Podere Gallina and La Risorta are to the east of Bologna near Po Valley Energy’s Sillaro and Santa Maddalena gas discoveries. Initial studies have identified seven gas prospects in these applications which are now being actively researched and investigated.

“We will now complete environmental clearance studies for the additional areas and then seek Ministerial approval for a grant of the full licences for these additional areas,” Mr Masterman said.

“This process usually takes about 12 months.”

In parallel with the environmental clearance process, Po Valley will conduct geological and geophysical studies on each of the license areas to better define and “prove up” the prospects. This will include acquisition and evaluation of the seismic data covering selected target areas. The Company is due to commence gas production in late 2007 from its initial batch of proven wells in northern Italy.

Michael Masterman Po Valley Energy 0417 851 303
Kevin Skinner Field Public Relations (08) 8234 9555 / 0414 822 631

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