Parallel Petroleum Corporation today announced its proved reserves as of December 31, 2006.

Proved Reserves as of December 31, 2006

As estimated by its independent engineers, Parallel's proved reserves as of December 31, 2006 increased approximately 52% to 38.5 million equivalent barrels of oil (MMBOE), as compared to 25.4 MMBOE as of December 31, 2005. Of the 13.1 MMBOE net increase, approximately 5.8 MMBOE were associated with the Company's two emerging resource gas projects and approximately 7.9 MMBOE were associated with its Permian Basin long-life oil projects, offset by a decrease of approximately 0.6 MMBOE associated with its gas projects located onshore the gulf coast of south Texas. The 2006 year-end proved reserves were 48% proved developed producing, 3% proved developed non-producing, and 49% proved undeveloped. The 2006 year-end proved reserves by volume were 75% oil and 25% natural gas. Please refer to Table 1 below for information pertaining to total proved reserves by category.

The Company's Permian Basin long-life oil projects represented approximately 87% of its proved reserves value, and its two emerging resource gas projects represented approximately 9% of the value. The NYMEX price per barrel of oil increased slightly from $61.04 to $61.06, and the NYMEX price per Mcf of natural gas decreased 42% from $9.43 to $5.47, when comparing December 31, 2005 to December 31, 2006. Please refer to Table 2 below for detail of proved reserves by area/property as of December 31, 2006.

Management Comments

Larry C. Oldham, Parallel's President, commented, "We are extremely pleased to have increased our proved reserves volumes by 52% during 2006. This was accomplished by the diligent efforts of the entire Parallel team. Because of our extensive acreage positions and inventory of drillable locations associated with our two emerging resource gas projects and our five low-risk development oil projects, we are in an excellent position to continue to build significant value for our shareholders. We look forward to continued growth in 2007."