As estimated by its independent engineers, Parallel's total proved reserves as of March 31, 2007 increased approximately 4% to 40.2 million equivalent barrels of oil (MMBOE), as compared to 38.5 MMBOE as of December 31, 2006.

The 1.7 MMBOE net increase was primarily associated with the Company's two emerging resource gas projects in the North Texas Barnett Shale and New Mexico Wolfcamp and included a slight increase associated with its Permian Basin long-life oil projects, offset by a slight decrease associated with its gas projects located onshore the gulf coast of south Texas.

The March 31, 2007 proved reserves were 46% proved developed producing, 3% proved developed non-producing, and 51% proved undeveloped. Approximately 71% of the proved undeveloped reserves are assigned to the Company's Permian Basin long-life oil properties and 28% are assigned to its two emerging resource gas projects. The March 31, 2007 proved reserves by volume were 71% oil and 29% natural gas.

The Company's Permian Basin long-life oil projects represented approximately 85% of its proved reserves value (before income taxes), and its two emerging resource gas projects represented approximately 12% of such value. The NYMEX price per barrel of oil increased 8% from $61.06 to $65.88, and the NYMEX price per Mcf of natural gas increased 37% from $5.47 to $7.48, when comparing December 31, 2006 to March 31, 2007.

Larry C. Oldham, Parallel's President commented, "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 grow the Company's reserves, production and value for our shareholders. We look forward to continued growth in 2007 and beyond."