Parallel Petroleum Corporation today announced its operations update. Parallel also announced its financial results for the second quarter ended June 30, 2007.

Second Quarter 2007 Production

As Parallel announced on July 18, 2007, the Company's net daily production for the second quarter ended June 30, 2007 averaged 6,035 equivalent barrels of oil per day (BOEPD), an increase of 3% when compared to an average of 5,859 BOEPD during the first quarter ended March 31, 2007. Production from the Company's two resource gas projects increased 12%, from 2,079 to 2,326 BOEPD, due to increased drilling and completion activity. This increase was partially offset by a 7% decrease in the Company's short-life South Texas gas properties, from 552 to 513 BOEPD, due to the divestiture of non-core assets and normal decline, and a 1% decrease in the Company's long-life Permian Basin oil projects, from 3,228 to 3,196 BOEPD, due to normal decline on base production and limited development activity during the second quarter 2007.

Parallel's net daily production of 6,035 BOEPD in the second quarter ended June 30, 2007 represented a decrease of 6% when compared to an average of 6,432 BOEPD during the second quarter ended June 30, 2006. This 6% decrease was primarily the net result of a 43% increase, from 1,632 to 2,326 BOEPD in the Company's two resource gas projects, an 8% decrease, from 3,474 to 3,196 BOEPD, in its long-life Permian Basin oil properties due to normal decline on base production and initial decline associated with infill development wells, and a 61% decrease, from 1,326 to 513 BOEPD, in the Company's short-life South Texas gas properties due to normal decline throughout the year and collapsed casing in a 38%-owned Yegua well and a mechanical problem associated with a 15%-owned Wilcox well during the fourth quarter of 2006.