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Po Valley Spuds Italian Gas Deviation Well

November 22, 2005

Australian petroleum explorer, Po Valley Energy Limited (“PVE”) continues to step up the pace of its exploration and drilling activities in northern Italy with the spudding on Monday of its Sillaro 1 Deviation well.

Sillaro 1D is being drilled to a target depth of 2,250 metres approximately 300 metres to the south of Sillaro 1 which the company drilled in July this year. Drilling of the Sillaro-1 deviation well, which commenced at 1,260 metres, targeting the Pliocene gas bearing zone, is expected to take 10 days.

Spud in of the well follows successful clean up operations at Sillaro 1 where 2.2km of tubing and 1.2km of 7” casing have been successfully recovered for use in Sillaro 1D.

Sillaro is one of several important development opportunities in Italy for the Australian gas explorer and developer and is located 25 kilometers to the east of Bologna in northern Italy. The deviation well will target the shallower Pliocene gas bearing structure with a subsequent well in 2006 expected to investigate the larger deeper Miocene target.

“The deviation of Sillaro 1 is an important well for us. We are deviating the well towards the former Budrio 2 gas well that tested commercial gas flows for ENI in the 1960s and our target is to replicate and improve on these results,” Po Valley’s Chief Executive Officer, Mr. Michael Masterman, said today.

During the recent September quarter, Po Valley completed an extensive review of the Sillaro field and the Sillaro 1 drilling and testing results.

The review concluded that the Sillaro anticline structure dipped deeper further towards the fault to the north than expected, resulting in Sillaro 1 intersecting with the Pliocene at a lower level than forecast, close to the gas water contact in the field.

The review further concluded that the Pliocene and Miocene reserves remain large and an attractive Pliocene drilling target has been defined to the south of Sillaro 1.

On the basis of this review, Po Valley elected to deviate the well, as eventuated over the weekend, towards the locations of the ENI Budrio 2 and Budrio 3 wells. Both wells showed gas in the target Pliocene at a higher level to Sillaro 1 and a production test of Budrio 2 demonstrated commercial gas flows.

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

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