Tri-Valley Corporation has encouraging results from an extended steam cycle completed last month on two of the seven horizontal wells on its Hunsucker Lease at Oxnard, California. The project is operated by a subsidiary, Tri-Valley Oil & Gas Co. (TVOG). The heavy oil lease, which is part of the Company's Pleasant Valley Project, averaged 256 barrels of oil per day in March, with peak rates as high as 800 to 1,000 barrels of oil per day. Cyclic steam stimulation is being utilized to produce heavy oil from the Hunsucker Lease. TVOG also initiated a second extended steam injection cycle on two other wells that should be returned to oil production in late April.

The Company is installing artificial lift equipment on four wells this month. Once these installations are completed, all seven horizontal wells on the Hunsucker Lease will have sufficient artificial lift capacity to permit higher sustained rates of production and maximum recovery of heavy oil following extended steam injection cycles in the future.

"We were extremely pleased to see the positive heavy oil production response results from the extended steam injection cycle we piloted on the two wells last month. This has encouraged us to move forward with our plans this year to pilot Steam Assisted Gravity Drainage (SAGD) technology that will allow continuous steam injection and heavy oil production at our Pleasant Valley Project at Oxnard," stated Maston Cunningham, Tri-Valley's new Chief Executive Officer.

TVOG plans to initiate SAGD operations during the third quarter of 2010 after it drills a horizontal injector well to be paired with one of the existing wells on the Hunsucker Lease. This will permit continuous steam injection and oil recovery. The Company believes the SAGD pilot is an integral step towards future deployment of its SAGD development plan for maximum recovery of its heavy oil assets at Pleasant Valley.

Tri-Valley recently completed a $5.0 million registered direct placement of its common stock and warrants with institutional investors. Sale proceeds will be used in part to drill the SAGD injector well and to start-up production from seven existing wells at its Claflin Lease near Bakersfield, California. The Company has also reduced its general and administrative costs following staff reductions and other cost saving actions that were implemented during February and March of this year, for an expected savings of approximately $1.0 million annually.

"We are transitioning our new management team and employees to focus on those critical factors that will enable us to deploy capital more effectively, to increase production and reserves, to lower operating costs, and to return the Company to profitability which will maximize value for our shareholders," Cunningham remarked. "I remain confident in the future of Tri-Valley and in the potential value of our petroleum and mineral assets which appear to be heavily discounted in our current stock price. If we execute effectively by continuing to focus on increasing revenues with higher levels of production, the value of our Company should be more reflective of the underlying assets and our ability to generate profits."

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