PELE Petrolatina

PetroLatina Energy Plc (�PetroLatina� or the �Company�) (LSE: PELE) an independent oil and gas exploration, development and production company, focused on Latin America, is pleased to announce it has initiated development of the Serafin gas accumulation in Colombia as expected. RATIONALE & CASH FLOW The Serafin gas accumulation was discovered in the early 1990s and tested at flow rates of up to 16 million cubic feet of gas per day. Recent increases in the price of gas in Colombia to $2.50 / $3 per thousand cubic feet mean the project offers strong short term cash flow and economic returns, with projected pay back in 5 months. The first commercial deliveries of gas are expected in the second quarter of 2007. The revenues from this project are expected to increase PetroLatina�s annual cash flow substantially from its Colombian operations. PRODUCTION POTENTIAL Based on the above test rates and pressure data, gross reserves are estimated between 4 and 8 billion cubic feet of biogenic gas. The plan is to re-enter and work over of the well in January 2007. PetroLatina believes there could be additional similar biogenic gas accumulations on the licence and is currently conducting studies using its existing 3D seismic coverage to identify further drillable prospects. PetroLatina has a 50% interest in the project. Nicholas Gay, President and CEO, commented, �The initiation of the Serafin Gas accumulation is a key milestone in the Company�s development. We are now firmly focussed on Colombia where we already have a revenue stream from oil production of approximately 500 barrels of oil a day and pipeline tariff income. The Serafin gas development has proven test rates and will provide the Company with additional early cash flows as well as substantially increasing our revenues from Colombia. Management is pleased to see the Company moving ahead as planned and we are excited about the further developments over the coming months.� BACKGROUND INFORMATION The Serafin gas discovery is located in the Tisquirama B area of the Tisquirama licence and is located to the north of the PetroLatina operated Los Angeles Field. History The discovery was drilled by Texas Petroleum in 1991. The target Paleocene Lisama sands were absent but the well encountered an 18 feet thick gas bearing sand in the Miocene Real Group. Log analysis indicates 18 feet of pay with a porosity of 28% and a water saturation of 27%. The sand was tested from 4,582 to 4,598 feet and flowed up to 16.0 million cubic feet of gas a day on extended tests. Reservoir pressure is 1,978 psi and the gas is over 97% methane. The gas is considered to be most likely of biogenic origin and has accumulated in a stratigraphic trap. Gross reserves estimated from material balance calculations and volumetrics vary from approximately 4 to 8 billion cubic feet of gas recoverable (2 to 4 billion cubic feet net to PetroLatina). Marketing & Logistics The well is located 3.5 kilometres from a main gas pipeline and can be tied in at that location. The development plan is for the well to be re-entered and worked over in January 2007. It will be then tested. Based on the results of this, the tie in connection and pipeline specifications will be designed. The pipeline is expected to be installed late first quarter/early second quarter 2007 with first commercial gas deliveries planned for late second quarter 2007. Costs The estimated cost of the development including the gas pipeline and tie in is $1.36 million ($680,000 net to PetroLatina). The cost of the development will be met from available cash resources. Based on information available in Colombia, the current regulatory commission for energy and gas (�CREG�) gas price for the area in which the development is located is approximately $3 per thousand cubic feet. The gas is planned to be sold to local industrial users. PetroLatina has a 50% interest in the project, with the other 50% being held by PetroSantander Inc. PetroSantander operates the Las Monas field in Colombia and is a partner in PetroLatina�s Santa Lucia field. REVIEW OF RELEASE This release has been reviewed by the Company�s Chief Operating Officer (Mr. J. Scott), and the Chief Geologist (Mr. K. Dean who is a Fellow of the Geological Society, London). Messrs Scott�s and Dean�s biographies are on the Company�s website, which can be found at www.petrolatinaenergy.com . PetroLatina Energy Plc ("PetroLatina" or the "Company") (LSE: PELE) an independent oil and gas exploration, development and production company, focused on Latin America, is pleased to announce it has initiated development of the Serafin gas accumulation in Colombia as expected. RATIONALE & CASH FLOW The Serafin gas accumulation was discovered in the early 1990s and tested at flow rates of up to 16 million cubic feet of gas per day. Recent increases in the price of gas in Colombia to $2.50 / $3 per thousand cubic feet mean the project offers strong short term cash flow and economic returns, with projected pay back in 5 months. The first commercial deliveries of gas are expected in the second quarter of 2007. The revenues from this project are expected to increase PetroLatina's annual cash flow substantially from its Colombian operations. PRODUCTION POTENTIAL Based on the above test rates and pressure data, gross reserves are estimated between 4 and 8 billion cubic feet of biogenic gas. The plan is to re-enter and work over of the well in January 2007. PetroLatina believes there could be additional similar biogenic gas accumulations on the licence and is currently conducting studies using its existing 3D seismic coverage to identify further drillable prospects. PetroLatina has a 50% interest in the project. Nicholas Gay, President and CEO, commented, "The initiation of the Serafin Gas accumulation is a key milestone in the Company's development. We are now firmly focussed on Colombia where we already have a revenue stream from oil production of approximately 500 barrels of oil a day and pipeline tariff income. The Serafin gas development has proven test rates and will provide the Company with additional early cash flows as well as substantially increasing our revenues from Colombia. Management is pleased to see the Company moving ahead as planned and we are excited about the further developments over the coming months." BACKGROUND INFORMATION The Serafin gas discovery is located in the Tisquirama B area of the Tisquirama licence and is located to the north of the PetroLatina operated Los Angeles Field. History The discovery was drilled by Texas Petroleum in 1991. The target Paleocene Lisama sands were absent but the well encountered an 18 feet thick gas bearing sand in the Miocene Real Group. Log analysis indicates 18 feet of pay with a porosity of 28% and a water saturation of 27%. The sand was tested from 4,582 to 4,598 feet and flowed up to 16.0 million cubic feet of gas a day on extended tests. Reservoir pressure is 1,978 psi and the gas is over 97% methane. The gas is considered to be most likely of biogenic origin and has accumulated in a stratigraphic trap. Gross reserves estimated from material balance calculations and volumetrics vary from approximately 4 to 8 billion cubic feet of gas recoverable (2 to 4 billion cubic feet net to PetroLatina). Marketing & Logistics The well is located 3.5 kilometres from a main gas pipeline and can be tied in at that location. The development plan is for the well to be re-entered and worked over in January 2007. It will be then tested. Based on the results of this, the tie in connection and pipeline specifications will be designed. The pipeline is expected to be installed late first quarter/early second quarter 2007 with first commercial gas deliveries planned for late second quarter 2007. Costs The estimated cost of the development including the gas pipeline and tie in is $1.36 million ($680,000 net to PetroLatina). The cost of the development will be met from available cash resources. Based on information available in Colombia, the current regulatory commission for energy and gas ("CREG") gas price for the area in which the development is located is approximately $3 per thousand cubic feet. The gas is planned to be sold to local industrial users. PetroLatina has a 50% interest in the project, with the other 50% being held by PetroSantander Inc. PetroSantander operates the Las Monas field in Colombia and is a partner in PetroLatina's Santa Lucia field. REVIEW OF RELEASE This release has been reviewed by the Company's Chief Operating Officer (Mr. J. Scott), and the Chief Geologist (Mr. K. Dean who is a Fellow of the Geological Society, London). Messrs Scott's and Dean's biographies are on the Company's website, which can be found at www.petrolatinaenergy.com .