RNS Number:5332J
Petrolatina Energy PLC
27 September 2006



                             PETROLATINA ENERGY Plc

                        ("PetroLatina" or the "Company")





            Interim Results for the Six Months Ended 30th June 2006





PetroLatina Energy Plc, an independent oil and gas exploration development and
production company focused on Latin America, listed on AIM, today announces its
interim results for the six months ended 30th June 2006.





2006 HIGHLIGHTS



Colombia



* Acquired and awarded interests in two exploration licences in the Middle
Magdalena Valley Colombia, Midas and La Paloma, with a combined potential for
recoverable oil reserves of up to 110 million barrels (76 million net to the
Company).



* Completed the acquisition of Petroleos del Norte S.A. ("PDN"), providing
stable production and oil revenues from two licences, three technical evaluation
licences and ownership of the revenue generating Rio Zulia - Ayucucho Pipeline.



* Commenced environmental assessments and a seismic reprocessing program on
Midas and La Paloma licences with a view to completing an extensive 2D seismic
shoot in early 2007.



* Initiated plans to re-enter Sarafina gas well and construct a pipeline tie-in
within Tisquirama acreage with a minimum expected production of 6 million cubic
feet ("mmscf") per day.



Guatemala



* Completed well 1X sidetrack on schedule with no problems, showing four
potential hydrocarbon bearing intervals. A full production test is planned for
late September / early October 2006.



* Well 3X was completed, tested and subsequently shut in to monitor and analyze
pressure build up data.



* Tortugas- Received full approval of Environmental Impact Assessment (EIA) and
commenced a detailed archeological study of the proposed work and seismic areas
prior to commencing operations.



* Atzam - completed surface contracts in preparation to work-over the first of
three existing wells on licence A7-2005.




Financial / Corporate



*        In July 2006 the Company changed its name from Taghmen Energy Plc to
PetroLatina Energy Plc to more fully reflect its Latin American focus.



*         Raised a total of # 20.2 million :

o        Completed three fund raisings of # 15 million (US$ 26.3 million), # 4.2
million (US$ 8.0 million) and # 0.973 million (US$ 1.8 million) respectively
before costs to support the Guatemalan work programme and PDN acquisition.



* Recorded first Colombian oil sales and pipeline revenues of US$ 420,000 for
the last 15 days of June, representing the post PDN acquisition period.



* Reported a loss of US$ 3.39 million for the 6 months to 30th June, 2006.



* Negotiated a US$ 7 million Bridging Loan with Macquarie Bank Limited for the
PDN acquisition. It is intended that this  will be replaced with a larger and
more longer term facility in connection with the extension of the Tisquirama
licence in Colombia.



Nicholas Gay, Chief Executive Officer of PetroLatina  Energy commented:



"I am delighted to report that PetroLatina has embarked on a new phase of
expansion and development through its diversification into Colombia. Our success
in identifying and securing these new exploration and production opportunities
fully demonstrates our ambition to develop into a significant oil and gas
company within Latin America. I look forward to bringing to shareholders further
good news during the remainder of 2006 and into 2007."



                                                               27 September 2006



Enquiries:


PetroLatina  Energy            Ian Refault,      Ianrefault@PetroLatinaenergy.com              +44(0)2072974360
www.PetroLatinaenergy.com      CFO

Pelham Public Relations        Charles Vivian    Charles.vivian@pelhampr.com                   +44(0)2077436672
                               Phillip Dennis    Phillip.dennis@pelhampr.com                   +44(0)2077436363






CHAIRMAN, CHIEF EXECUTIVE OFFICER AND CHIEF OPERATING OFFICER'S JOINT STATEMENT



The first six months to 30 June 2006 has been an exciting period in the
development of the Company. PetroLatina has successfully diversified into
Colombia through the addition of valuable exploration, production and
development opportunities. The Company now has a stable and secure revenue
stream from production and pipeline operations together with extensive new
exploration acreage in Colombia to add to its existing Guatemalan assets.



Production and Revenues



Through the PDN acquisition, PetroLatina currently produces approximately 500
barrels of oil per day ("bopd") net to the Company from two fields and owns and
operates the revenue producing Rio Zulia - Ayucucho Pipeline. These two assets
generated approximately US$ 420,000 of revenue during the last 15 days of June
2006, post acquisition.



Reserves



In Colombia, the Company estimates that, based on identified leads, Midas could
contain 90 million (63 million net to PetroLatina) barrels of oil and La Paloma
20 million (13 million net to PetroLatina) barrels of oil. This, together with
an estimated 16 million barrels of oil potential from the Atzam structure on the
A7-2005 licence in Guatemala acquired in late 2005, brings the total new
exploration potential of the Company to 92 million barrels of oil in the last
nine months.



In addition, PetroLatina holds 24.8 million proved, probable and possible
reserves on Licence 6-93 in Guatemala and approximately 13. 5 million (net to
its interests) on the Tisquirama licence in Colombia.



The previously reported US$ 13 million second stage payment for PDN is directly
tied to the successful extension of the Tisquirama licence from 2009/2011 to
2025. Negotiations have commenced with joint venture partners and the Colombian
authorities to secure this extension under favorable terms. Negotiations of this
type can be lengthy but should be completed in the first half of 2007. The total
reserves on this licence, as noted above, are dependent on the licence
extension.



In conclusion, the addition of these new diversified Colombian assets put
PetroLatina on a solid footing for the future and cements the Company as a truly
Latin American concern.



REVIEW OF OPERATIONS AND WORK PROGRAMME



Colombia



Within the Tisquirama production licence and located less than two miles from
the Los Angeles production facility, is the Sarafina exploration gas well which
was drilled in the 1970's and flowed more than 85 mmscf of very clean dry gas.
The well was drilled, tested and subsequently abandoned due to there being
limited gas sales potential in Colombia at that time and no gas pipeline
infrastructure in the area to tie into. Circumstances have now changed with
natural gas in high demand and a major gas pipeline available 3.5 kilometers
from the well site.



PetroLatina plans to re-enter the Sarafina well and construct a 3.5 kilometer
pipeline to tie into the gas pipeline system now in place. With current gas
prices in Colombia and using detailed testing data from the well, management
expect future production to exceed 6 mmcf per day and a rapid payback of
re-entry, surface facilities and pipeline costs in less than six months from the
first gas production. This could prove a near term bonus from the PDN
acquisition.



Further development of the existing production licence areas will include a
small 3D seismic shoot over the Santa Lucia field. This will allow the Company
to better identify both infill wells for a rapid increase in production and step
out drilling potential in the area together with enhancing the definition of a
potential deep target under Santa Lucia. This development phase will begin in
early 2007.



Regarding exploration of the Midas and La Paloma licences, environmental work
has already commenced as a pre-requisite to operational activity. The
re-processing of seismic data is underway and an extensive 2D seismic shoot is
currently being designed for both areas. Data interpreted to date is very
encouraging and ties into that already existing on the adjoining Tisquirama
block. These two work programmes are financed from US$ 2.5 million deposited in
trust funds in Colombia on securing interests in the licences.



The Company will also plan and evaluate the three Technical Evaluation Areas
which are believed to hold significant further potential.



Guatemala



Guatemala has been an extremely difficult project to date. However, with the
drilling of Las Casas well 3X and the side tracking well 1X, PetroLatina has
proven oil in place.



In Las Casas, the Well 1X sidetrack was completed on schedule. The Well showed
four hydrocarbon bearing intervals and will be production tested in late
September / early October 2006, following removal of the Roll'n International
drilling unit.



Well 3X was swabbed and recorded oil inflow from two intervals but a rapid
decline in pressure in both intervals indicated this to be in a separate fault
block containing limited reserves. In addition, a wax problem together with very
low fluid levels forced the Company to remove the PCP pumping system, which had
been installed for an extended pump test. PetroLatina is currently re-evaluating
alternative methods of pumping best suited for these wells with significant
deviation, wax deposition and low fluid levels.



Following the testing of well 1XD, the service rig will be moved to and
mobilized at the A7-2005 acreage to commence re-entry operations in the Tortugas
/ Atzam project. Start up of this project has been slower than planned because
the initial Archeological survey of the license area showed a Mayan City based
around the Tortugas salt dome. PetroLatina is working closely with the
Guatemalan government to assure that any work undertaken does not interfere with
the preservation of these ruins



PetroLatina intends to work-over a total of three existing wells in the Tortugas
/Atzam licence areas and has to date completed the surface contract in
preparation for the first, Atzam 2. The main camp and workshop site in Tortugas
have been relocated away from the archaeological sites.  Operations on the Atzam
2 re-entry are scheduled to begin in October 2006, with forecast production from
this well estimated to be in range of 150 to 300 bopd.



The Company has released the Roll'n International Drilling rig and is now
preparing to demobilize the rig to Puerto St Thomas on the east coast and then
remove it from the country. It has been determined that  much more detailed
Geological and Geophysical studies must be carried out prior to drilling the
first Huapac well or any further wells in the 6-93 contract area. Operational
management is currently inspecting smaller rigs in Mexico and Belize for the
Tortugas drilling program. When the Company is prepared to resume deeper
drilling in 6-93, management believe that rigs currently in Guatemala or
possibly Mexico will be available as and when required.



FINANCIALS



In the first 6 months of 2006, the operating loss was US$ 3.39 million. Turnover
of US$ 0.42 million consists of oil sales and pipeline income in Colombia and
cost of sales of US$ 0.06 million is operational costs related to that turnover.
Within expenses are non cash costs of US$ 1.12 million, being the write off of
deferred costs created at the time of formation and flotation of the Company and
depreciation.



Administrative expenses are relatively high for the period and reflect the fact
that the Company is now operating from three offices, London, Guatemala and
Colombia, is listed on the London exchange and has been actively pursuing
acquisitions. These costs are currently under review and the Company is looking
at synergies between the Guatemalan, Colombian and London offices to reduce
expenses going forward.



In August and September 2006 the Company replaced a significant amount of the
funds used to acquire PDN through private placements of equity, raising # 5.17
million (approximately US$ 9.8 million). This is in addition to the # 15 million
(approximately US$ 26.3 million) raised earlier in the period.





APPOINTMENT



PetroLatina has recently appointed Ian M. Refault as Chief Financial Officer
effective August 28th 2006. Ian brings valuable experience to the Company from
11 years in the International Oil and Gas Industry and has worked with most of
the current management team in previous positions.



OUTLOOK



In summary, the diversification into Colombia, the addition of exploration
acreage and the recent acquisition of PDN puts PetroLatina in an excellent
position for future growth through the proving up of an expanded reserve base
and increasing production and operational cash flows.


Greg Smith                      Nicholas Gay                                Jay Scott
Executive Chairman              Chief Executive Officer                     Chief Operating Officer




CONSOLIDATED FINANCIAL STATEMENTS:


Consolidated profit and loss account for the six months ended 30 June 2006

                              Continuing
                    Note      Operations    Acquisitions           Total

                               Unaudited       Unaudited       Unaudited                 Audited           Unaudited
                             Period from     Period from     Period from             Period from         Period from
                          1 January 2006  1 January 2006  1 January 2006             7 July 2004     1 November 2004
                              to 30 June to 30 June 2006 to 30 June 2006     to 31 December 2005     to 30 June 2005
                                    2006

                                       $               $               $                       $                   $
Income
Turnover                               -         420,950         420,950                       -                   -
Cost of sales                          -        (57,558)        (57,558)                       -                   -
Gross Profit                           -         363,392         363,392                       -                   -
Administration
expenses                     (2,764,250)        (48,450)     (2,812,700)             (4,139,149)         (2,845,025)
Depreciation                   (128,070)        (49,467)       (177,537)               (270,676)            (99,536)
Amortisation of
deferred share                 (946,750)               -       (946,750)             (2,014,333)         (1,182,167)
costs
Exchange (gain) /               (26,355)           9,851        (16,504)               (300,404)           (330,063)
loss
Operating Profit /
(Loss)                       (3,865,424)         275,326     (3,590,098)             (6,724,562)         (4,456,791)
Profit / (Loss) on
ordinary activities
before interest and          
tax                          (3,865,424)         275,326     (3,590,098)             (6,724,562)         (4,456,791)
Interest receivable              258,623             507         259,130                 216,648             160,810
Interest payable                (17,502)        (45,324)        (62,826)                (39,472)                   -
Profit / (Loss) for
the
period before and
after taxation               (3,624,303)         230,509     (3,393,794)             (6,547,386)         (4,295,981)

Profit / (Loss) per
share
    Basic             2          ($0.05)           $0.00         ($0.05)                 ($0.15)             ($0.09)

All amounts relate to continuing activities
There are no recognized gains or losses for the period, other than the loss for the period

The notes form part of these unaudited financial statements







Consolidated balance sheet at 30 June 2006


                        Note  Unaudited 30    Unaudited 30      Audited 31      Audited 31     Unaudited      Unaudited
                                      June            June        December        December       30 June        30 June
                                      2006            2006            2005            2005          2005           2005
                                         $               $               $               $             $              $
Fixed assets
Tangible assets          3                     20,942,601                        1,411,636                    1,410,479
Intangible assets        4                     26,333,169                       19,870,700                    9,017,069

Investments                                       115,643                               -
                                               47,391,413                      21,282,336                    10,427,548
Current assets
Stock                           1,587,673                        1,363,134                     1,694,356
Debtors                  5      3,386,471                        1,055,858                     1,288,350
Deferred share costs     5      1,066,417                        1,772,667                     1,893,500
due within one year
Deferred share costs     5      1,202,500                        1,443,000                     2,154,333
due after one year
Cash at bank and in             4,655,067                        1,293,738                     6,557,552
hand
                                11,898,128                       6,928,397                    13,588,091
Creditors falling due    6
within one year               (11,472,312)                     (3,658,792)                     (408,434)
                              


Net current assets                                425,816                       3,269,605                   13,179,657

Creditors falling due                            (217,634)                              -                    (350,000)
after one year

Provision for                                    (299,628)                       (299,628)                    (225,000)
liabilities

Total assets less
current liabilities                            47,299,967                      24,252,313                   23,032,205
                                               

Capital and reserves
Called up share capital  7                      8,465,036                       5,495,976                     5,168,126
Share premium            7                     48,636,500                      25,164,111                    22,501,129
Warrant reserve                                   139,612                          139,612                      139,612
Profit and loss account                        (9,941,181)                     (6,547,386)                  (4,776,662)

Shareholders funds                             47,299,967                      24,252,313                    23,032,205

                                               

Approved by the Board of Directors on September 26th 2006



The notes form part of these unaudited financial statements



Consolidated cash flow statement for the six months ended 30 June 2006

                   Note       Unaudited      Unaudited         Unaudited        Unaudited       Unaudited     Unaudited
                            Period from    Period from       Period from      Period from     Period from   Period from
                         1 January 2006 1 January 2006       7 July 2004      7 July 2004      1 November    1 November
                             to 30 June     to 30 June    to 31 December  to 31  December         2004 to       2004 to
                                   2006           2006              2005             2005    30 June 2005  30 June 2005
                                      $              $                 $                $               $             $
Net cash outflow
from operating
activities           8                     (4,061,955)                        (5,165,654)                   (5,815,462)
Returns on
investments and
serving of finance
Interest received               259,130                          216,648                          160,810

Interest paid                  (14,092)
Cash acquired with
subsidiary          10          226,512                           29,897                               -
Consideration              (19,585,663)                      (3,352,067)                        (123,295)
                                          (19,114,113)                        (3,105,522)                        37,515
Capital
expenditure
Exploration
expenditure                 (6,161,801)                     (12,665,501)                      (3,371,389)
Purchase of
tangible fixed
assets                        (441,583)                      (1,174,452)                         (49,718)
                                           (6,603,384)                       (13,839,953)                   (3,421,107)
Cash outflow
before use of
liquid resources                          
and financing                             (29,779,452)                       (22,111,129)                   (9,199,054)


Management of
liquid resources                           (2,351,728)                          (966,819)                     (954,026)
                                           

Financing
Issue of ordinary
shares                      27,408,499                        22,404,867                        2,000,000
Exercise of share                                              
warrants                              -                        1,000,000                                -
Share issue/ AIM            (1,267,718)                                                       (2,911,927)
listing costs
Loan                 11       7,000,000                                                                 -
                                                                                                     
                     

                                           33,140,781                          23,404,867                     (911,927)
Increase in cash     9                      1,009,601                             326,919                  (11,065,007)


Opening net funds                             326,919                                   -                    16,668,533
                                               
Net funds at the                                                                                             
end of the period                            1,336,520                            326,919                     5,603,526
                                             





The notes form part of these unaudited financial statements




Notes forming part of the unaudited financial statements for the period ended 30
June 2006





1. Accounting policies



Basis of preparation



The unaudited financial statements have been prepared in accordance with
accounting standards applicable in the United Kingdom at the balance sheet date.



The unaudited financial statements for the six months ended 30 June 2006 have
been prepared in accordance with accounting principles applied by the group in
the prior accounting period and those expected to be adopted in the Group's full
financial statements for the year ended 31 December 2006.



The financial information shown in this publication is unaudited and does not
constitute statutory accounts as defined in section 240 of the Companies Act
1985.



In order to achieve its planned business expansion and development plan, the
company will be dependent on the receipt of additional funds in the future,
which the company plans to obtain through the issue of share capital and/or debt
financing.



The unaudited financial statements have been presented in US$ dollars as this is
considered to be the group's functional currency.



2.  Loss per share



The loss per Ordinary Share has been calculated using the weighted average
number of shares in issue during the period.  The weighted average number of
Ordinary shares in issue in the period was 73,710,803 (30 June 2005 -
48,685,620) and the loss, being the loss after tax, was $3,393,795 (30 June 2005
- $4,295,981)



Due to the losses incurred during the period a diluted loss per share has not
been calculated as this would serve to reduce the basic loss per share.



3. Tangible assets


                                  Note         Unaudited 30 June            Audited 31        Unaudited 30
                                                            2006         December 2005           June 2005
                                                               $                     $                   $

Cost
At start of period                                     1,683,064                     -                   -
Acquisition of subsidiary          10                 19,266,919               508,612             508,612
Additions                                                441,583             1,174,452           1,074,433
                                                      21,391,566             1,683,064           1,583,045
Amortisation
At start of period                                       271,428                     -                   -
Charge for period                                        177,537               271,428             172,566
                                                         448,965               271,428             172,566

Net Book Value                                        20,942,601             1,411,636           1,410,479





4. Intangible assets


                                               Unaudited 30 June             Audited 31     Unaudited 30 June
                                                            2006          December 2005                  2005
                                                               $                      $                     $
At start of period                                    19,870,700                      -             4,595,680
Acquisition of subsidiary                                      -              4,261,665                     -

Additions                                              6,462,469             15,609,035             4,421,389
                                                      26,333,169             19,870,700             9,017,069



The intangible assets relate to unproven oil and gas properties in Guatemala



5. Debtors


                                              Unaudited 30 June             Audited 31     Unudited 30 June
                                                           2006          December 2005                 2005
                                                              $                      $                    $
Other taxes and social security                       1,031,963                775,989              412,522


Prepayments                                             437,508                133,494                    -
Other debtors                                         1,917,000                146,375              875,828
                                                      3,386,471              1,055,858            1,288,350
Deferred share cost due within one year               1,066,417              1,772,667            1,893,500
Deferred share costs due after one year               1,202,500              1,443,000            2,154,333
                                                      5,655,388              4,271,525            5,336,183



Other taxes and social security debtors are due for payment after one year.



6. Creditors: amounts falling due within one year


                                              Unaudited 30 June          Audited 31      Unaudited 30
                                                           2006       December 2005         June 2005
                                                              $                   $                 $
Trade creditors                                         506,817           1,000,003           253,564
Other taxes and social security                         319,604              33,203            47,647
Interest on convertible loans                            88,206              39,472                 -
Accruals                                              2,326,651           2,236,114           107,223
Convertible loan notes                                  350,000             350,000                 -
Short term loans (see notes 9 and 11)                 7,881,034                   -                 -
                                                     11,472,312           3,658,792           408,434




7. Share capital


                                          Issue          Number                           Share           Share
                              Date        Price       Of Shares   Consideration         Capital         Premium
                                              $                               $               $               $
At 1 January 2006                                    53,951,313      30,660,087       5,495,976      25,164,111
Issues pursuant    17 January, 2006        0.90       1,106,194       1,000,000         110,619         889,381
to equity offerings
                       10 February,        0.96      27,272,727      26,308,500       2,727,273      23,581,227
                               2006
Issues in lieu of    20 March, 2006        0.96         311,688         300,668          31,169         269,499
compensation
Issues pursuant      24 March, 2006        0.10       1,000,000         100,000         100,000               -
to exercise of
warrants
At 30 June 2006                                      83,641,922      58,369,254       8,465,037      49,904,218
Share issue costs                                                                                   (1,267,718)
Balance                                                                                              48,636,500



8. Reconciliation of operating loss to net cash outflow from operating
activities


                                                               Unaudited Period               Unaudited Period
                                                            from 1 January 2006                from 1 November
                                                                to 30 June 2006           2004 to 30 June 2005
                                                                              $                              $
Operating loss                                                      (3,590,098)                    (4,456,791)
Increase / (Decrease) in creditors                                    (423,712)                         33,001
Increase in debtors                                                   (996,798)                      (996,594)
Increase in inventory                                                 (175,634)                    (1,676,781)
Depreciation                                                            177,537                         99,536
Amortisation of deferred share costs                                    946,750                      1,182,167
                                                                    (4,061,955)                    (5,815,462)



 9. Analysis of net funds / Debt


                           Unaudited At                           Audited At                         Unaudited At
                                30 June        Cash flow         31 December       Cash flow              30 June
Net Funds                          2005                                 2005                                 2006

                                      $                $                   $               $                    $
Cash at bank and              5,603,526      (5,276,607)             326,919       1,009,601            1,336,520
in hand
Other liquid                    954,026           12,793             966,819       2,351,728            3,318,547
resources
Total Net Funds               6,557,552      (5,263,814)           1,293,738       3,361,329            4,655,067
Debt
Short term loans                      -                -                   -       7,000,000            7,000,000
(see note 11)
Other loans                           -                -                   -         881,034              881,034
Total debt                            -                -                   -       7,881,034            7,881,034



10. Acquisition of Petroleos del Norte S.A.



The Company has agreed to pay US $32 million for Petroleos del Norte S.A. 
("PDN"), payable in two installments. The first installment of US $19 million was
paid on June 16, 2006.  The second installment is for US $13 million and is
payable when the Tisquirama licence (containing the Los Angeles and Santa Lucia
fields) has been extended.  The second installment may be reduced should the
terms under which the Tisquirama licence is extended change beyond those
specified in the sale and purchase agreement. Due to uncertainty as to the
length of negotiations related to the extension of the Tisquirama licence and
the exact amount that will be paid on extension, management has not accounted or
provided for the second installment in these interim accounts.



In exchange for the payment of the first installment, PetroLatina has acquired a
controlling interest of 77.76% of the issued and outstanding share capital of
PDN.  The remaining 22.24% of the issued and outstanding shares of PDN are held
in a trust in Colombia and their release from such trust is subject to the
resolution of pending litigation.  Based on the advice of counsel in Colombia,
PetroLatina believes that the litigation will ultimately result in the shares
held in trust being returned to PDN for cancellation, which would result in
PetroLatina holding 100% of the issued and outstanding shares of PDN.



No minority interest has been accounted for as it is believed the Company owns,
in effect, 100% of PDN.



On 16th June, 2006, the Company acquired control of PDN for a consideration of
US $19,113,229, which includes an adjustment of US $113,229 for certain working
capital but excludes professional fees.



In calculating the good will arising on acquisition, the fair market value of
net assets of PDN have been assessed and adjustments from book value have been
made as necessary. These adjustments are summarised in the following table.




                                                                  Fair value               Fair value on
                                       Book value                adjustments                 acquisition
                                                $                          $                           $
Fixed Assets
- Pipeline                                620,430                  9,379,570                  10,000,000
- Oil and Gas assets                    5,949,136                  3,317,783                   9,266,919
- Other Long term
Investments                               262,397                  (146,754)                     115,643
                                        6,831,963                 12,550,599                  19,382,562
Current Assets
- Debtors                               1,373,740                   (39,925)                   1,333,815
- Inventory                                48,905                          -                      48,905
- Cash                                    226,512                          -                     226,512
Total Assets                            8,481,120                 12,510,674                  20,991,794
- Creditors                             (466,110)                          -                   (466,110)
- Loans                                 (940,021)                          -                   (940,021)
Net Assets                              7,074,989                 12,510,674                  19,585,663



The Consideration for acquisition was made up as follows:


                                                                                                        $
Cash                                                                                           12,113,229
Proceeds of loan ( see note 12)                                                                 7,000,000
Professional Fees                                                                                 472,434
Total consideration                                                                            19,585,663
Fair value of nets assets acquired (above)                                                     19,585,663
Goodwill arising on acquisition                                                                         -



The fair value adjustment to the carrying cost of the pipeline was determined by
the Directors based on a Gaffney Cline report commissioned as part of the due
diligence work.



The fair value of all the other non oil and gas assets and liabilities relates
to the assessed fair value of these balances on acquisition.



For the period prior to acquisition, PDN recorded a loss of US $1,214,668. This
was due to certain service charges rendered by the previous owner. In the post
acquisition period, PDN recorded a net profit of US $230,509. This has been
consolidated into the Group's net earnings.



11. Bridge Loan



As part of the acquisition of PDN, the Company took out a US$7 million bridge
loan from Macquarie Bank Limited. The loan expires on 15th March 2007 and
carries an interest rate of LIBOR plus 5.5%. The loan is secured against the
assets of PetroLatina and its subsidiaries, including PDN.



It is intended to replace the loan with a long term reserve based loan in due
course.



12. Post Balance Sheet Events



On 10th August, 2006 the Company issued and allotted 250,000 new ordinary shares
following the exercise of the equivalent number of $0.10 warrants in the Company
by an existing shareholder, Taghmen Ventures Limited ("Taghmen Ventures").



In August and Septemeber, 2006 the Company raised #4,200,040 and #973,000
through two placements of 21,000,200 and 4,865,000 ordinary shares of $0.10 with
UK investors. Applications were made for the new ordinary shares to be admitted
to trading on AIM and dealings commenced on 1st September  and 25th September
2006 respectively.



13. Material Non Cash Transactions



In March, 2006 311,688 the Company issued new ordinary shares of $0.10 each to
Terra Seis (Malta) Limited in consideration for commercial services relating to
the acquisition of seismic data on the Company's Guatemalan operations.



In June, 2006 the Company issued 7 million warrants to Macquarie Bank Limited to
subscribe for ordinary shares of $0.10 each at a price of #0.55, exercisable
between March 2007 and June 15th 2010.




                      This information is provided by RNS
            The company news service from the London Stock Exchange
END

IR SESEDMSMSEDU

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