Penn Virginia Corporation Provides Second Quarter 2007 Oil and Gas Operational Update and Increases 2007 Production Guidance

Seventh Consecutive Quarterly Production Record and a 34 Percent Increase in Production over the Prior Year Quarter

RADNOR, Pa.--

Penn Virginia Corporation (NYSE:PVA) today announced record levels of quarterly production and provided an update of its oil and gas operational activities, including second quarter 2007 operational results and increased 2007 production guidance.

Second Quarter Highlights and Guidance Update

Operational results for PVA's oil and gas segment during the second quarter of 2007 included the following:

    --  Record oil and gas production of 10.1 billion cubic feet of
        natural gas equivalent (Bcfe), or 110.5 million cubic feet of
        natural gas equivalent (MMcfe) per day;

    --  Year-over-year production growth of 34 percent over the 7.5
        Bcfe, or 82.4 MMcfe per day, in the second quarter of 2006;

    --  Sequential production growth of 15 percent over the 8.7 Bcfe,
        or 97.0 MMcfe per day, in the first quarter of 2007;

    --  Oil and gas capital expenditures of approximately $112
        million;

    --  71 (54.0 net) wells drilled, with 70 (53.4 net) successes (a
        99 percent success rate) and one (0.6 net) unsuccessful well;

    Full-year 2007 guidance updates are as follows:

    --  Revised full-year 2007 production guidance, increasing the
        estimated full-year levels to a range of between 39.0 Bcfe and
        40.0 Bcfe, or between 106.8 MMcfe per day and 109.6 MMcfe per
        day; and

    --  Revised full-year 2007 oil and gas capital expenditures
        guidance, increasing the estimated full-year levels, including
        closed acquisitions, to a range of between $380 million and
        $405 million.

    Second Quarter 2007 Operational Results

Production in the second quarter of 2007 was 10.1 Bcfe, or 110.5 MMcfe per day, an increase of 34 percent over the 7.5 Bcfe, or 82.4 MMcfe per day, in the second quarter of 2006. Production in the second quarter of 2007 represented the seventh consecutive quarterly production record and was 15 percent higher than the previous record of 8.5 Bcfe set in the first quarter of 2007. The year-over-year production increase was primarily due to successful exploratory drilling in south Louisiana in the first quarter of 2007, active development drilling programs in the Cotton Valley and the Selma Chalk, and the mid-2006 acquisition in the Mid-Continent region, together with development drilling related to these acquired operations.

Based on production and drilling program results thus far in 2007, PVA now expects full-year 2007 production to range between 39.0 and 40.0 Bcfe, or between 106.8 and 109.6 MMcfe per day, revised from the 37.0 to 38.5 Bcfe of previous guidance. The revised production guidance represents an expected increase of between 25 percent and 28 percent over 2006 production levels. For the month of June 2007, daily oil and gas production averaged approximately 111 MMcfe per day. PVA has provided additional guidance details in the separate second quarter 2007 financial results press release.

Capital Expenditures

During the second quarter of 2007, oil and gas capital expenditures were approximately $112 million ($208 million for the first half of 2007), consisting of:

    --  $86 million to drill 71 (54.0 net) wells, with 70 (53.4 net)
        successes (a 99 percent success rate) and one (0.6 net)
        unsuccessful well, with no completed exploratory wells during
        the second quarter;

    --  $5 million for the expansion of gathering systems and other
        production facilities; and

    --  $21 million for leasehold, property and reserve acquisitions,
        seismic data and other expenditures.

PVA budgeted 2007 oil and gas capital expenditures of $334 million, excluding proved reserve acquisitions. Due to the closing of several proved reserve acquisitions and upcoming drilling related to those acquired assets, together with an increase in the development program in the Selma Chalk and additional exploratory drilling, PVA now expects full-year 2007 oil and gas capital expenditures to range between $380 million and $405 million.

Second Quarter 2007 Operations Update

Cotton Valley / East Texas - In the Cotton Valley play in East Texas during the second quarter of 2007, PVA drilled 28 (19.2 net) wells, including: (i) 21 (12.2 net) wells within PVA's area of mutual interest (AMI) with GMX Resources Inc. (NASDAQ:GMXR) and (ii) seven wells outside the AMI in PVA's 100 percent working interest acreage. All of the wells were successful.

Production from the Cotton Valley for the second quarter averaged 17.9 MMcfe per day, which represented an increase of 96 percent from the 9.1 MMcfe per day produced in the second quarter of 2006 and an increase of three percent from the 17.6 MMcfe per day produced in the first quarter of 2007. Delays in stimulations due to testing related to changes in the methods of completion coupled with inclement weather and related pipeline construction delays, negatively impacted production in the area during the first half of 2007. However, completion activity has increased significantly over the last month and larger production increases are expected in upcoming quarters. Five rigs are currently drilling in the play, four in the AMI and one in the 100-percent working interest area.

PVA will soon initiate 20-acre spaced drilling in the Cotton Valley as recently approved by the Texas Railroad Commission and will drill between five and ten of these wells by the end of the year. In addition, PVA plans to commence the drilling of a horizontal Cotton Valley well in the Taylor interval as well as a horizontal well in the Lower Bossier interval during the second half of 2007.

Selma Chalk / Mississippi - In the Selma Chalk play in Mississippi during the second quarter, PVA drilled 22 (21.9 net) development wells. All of the wells were successful.

Production from the Selma Chalk for the second quarter averaged 20.2 MMcfe per day, which represented an increase of 17 percent from the 17.2 MMcfe per day produced in the second quarter of 2006 and an increase of one percent from the 20.1 MMcfe per day produced in the first quarter of 2007. Production in the second quarter was affected by gathering and compressor limitations in Baxterville which were recently resolved and larger production increases are expected in upcoming quarters. PVA continues to actively develop its assets in the Selma Chalk, and currently has two rigs drilling, with a third rig expected soon.

As previously disclosed, PVA drilled two horizontal Selma Chalk test wells, one in the Gwinville Field and one in the Baxterville Field. The performance of the well in the Gwinville Field has met management's expectations and, to date, the well in the Baxterville Field has exceeded management's expectations. PVA is encouraged by the application of horizontal drilling in the Selma Chalk and believes that this method, once implemented, will not only increase production rates but also will add incremental reserves due to a more efficient draining of the reservoir. PVA's plan is to drill at least one more horizontal well in the Baxterville Field before the end of the year with a ramp up in drilling activity in 2008.

Mid-Continent Region - In the Mid-Continent region during the second quarter, PVA drilled 14 (10.4 net) wells, including 13 Hartshorne single-lateral horizontal coalbed methane (HCBM) development wells and one (0.5 net) Granite Wash development well. All of the wells were successful except for one (0.6 net) Hartshorne HCBM development well which encountered mechanical issues during drilling and was subsequently re-drilled.

Production in the Mid-Continent region during the second quarter averaged 9.5 MMcfe per day, which represented an increase of six percent from the 9.0 MMcfe per day produced in the first quarter of 2007. PVA continues to aggressively develop the properties it acquired in the Arkoma and Anadarko Basins in June 2006, and currently has two rigs drilling Hartshorne HCBM wells and one rig drilling a horizontal Granite Wash well.

As previously disclosed, PVA drilled five horizontal Fayetteville Shale wells in Pope County, Arkansas during the fourth quarter of 2006 and first quarter of 2007, with two (1.4 net) successful PVA-operated wells and three (0.8 net) successful outside-operated wells. The five wells drilled to date are all producing. PVA expects to resume drilling horizontal Fayetteville Shale wells soon and expects to drill approximately five additional wells during the balance of 2007 in order to test its acreage position. After evaluating the production of not only the first five wells but also the approximate five wells to be drilled, PVA will decide whether to initiate a development drilling program in 2008.

Appalachia - In Appalachia during the second quarter, PVA drilled seven (2.4 net) wells, including four (2.0 net) multi-lateral HCBM development wells and three (0.4 net) outside-operated conventional wells. All of the wells were successful.

Production in Appalachia during the second quarter averaged 34.3 MMcfe per day, which represented a decrease of three percent from the 35.5 MMcfe per day produced in the second quarter of 2006 and an increase of seven percent from the 32.5 MMcfe per day produced in the first quarter of 2007. Two horizontal rigs are currently drilling.

In Appalachia, production decreases associated with the HCBM development program during 2006 and the first quarter of 2007 began to be reversed during the second quarter of 2007 due to production contributions from previously shut-in HCBM patterns. The completion of a water gathering collection system, the simultaneous drilling and automation of additional disposal wells and the issuance of land application disposal permits during the first quarter of 2007 are expected to result in increased HCBM production due to contributions from those previously drilled and shut-in patterns, as well as HCBM wells to be drilled in the future. Many of these wells go through a de-watering period, which will vary in length from well to well, after which management anticipates production will increase over time. Delays in obtaining drilling permits are hampering HCBM drilling activity. Active horizontal drilling rigs have been reduced from four to two over the last few months due to an insufficient inventory of drilling permits. As sufficient permits are obtained, drilling activity will increase accordingly.

During the second quarter, PVA commenced drilling of the first well in a planned five-well exploratory horizontal drilling program in the Devonian Shale in West Virginia. The drilling of a vertical well to collect some technical information in the shale has recently been completed after which the rig moved off. A drilling rig is expected late in the third quarter to drill the horizontal portion of the well.

Late in the third quarter or early fourth quarter a horizontal lateral will be drilled in the New Albany Shale from a vertical well drilled and cored in the New Albany in late 2006. PVA has acquired approximately 30,000 acres in this play in two different prospect areas.

Gulf Coast - In the Gulf Coast, which includes onshore south Texas and south Louisiana, PVA did not complete drilling of any wells during the second quarter.

Production in the Gulf Coast during the second quarter of 2007 was 28.7 MMcfe per day, which represented an increase of 48 percent from the 19.4 MMcfe per day in the second quarter of 2006 and an increase of 64 percent from the 17.7 MMcfe per day in the first quarter of 2007. The increases were attributable to a net increase in production from south Louisiana due to recent exploration success. Completion attempts of an exploratory well drilled in the first quarter in Bayou Sale in St. Mary Parish were unsuccessful and the well was plugged and abandoned.

The increase in production from south Louisiana is associated primarily with multiple discoveries in Bayou Postillion in Iberia Parish, Louisiana, which is producing approximately 100 MMcfe per day (16 MMcfe per day, net) from six wells drilled over the last few years. Two additional wells will tentatively be drilled in Bayou Postillion in 2007, the first of which (Cotten Land #2) is currently drilling as a sidetrack operation since the objective sand was "shaled" or "faulted" out in the fault block originally tested. The sidetrack operation will test an adjacent fault block. Brigham Exploration Company (NASDAQ:BEXP) is the operator during the drilling phase and PVA is the operator during the production phase.

Derivative Update

The following table shows PVA's current derivative positions for natural gas and oil production:

                                              Weighted Average
                                           Price per MMBtu or Bbl
                                       -------------------------------
                             Average
                             Volume    Additional
                             Per Day   Put Option    Floor    Ceiling
                           ----------- ----------  --------- ---------
                             (MMBtu)
Natural Gas Costless
 Collars
Third Quarter 2007              15,000             $    7.33 $   12.93
Fourth Quarter 2007             11,685             $    8.28 $   15.78
First Quarter 2008              10,000             $    9.00 $   17.95

Natural Gas Three-Way
 Collars*
Third Quarter 2007              33,000 $     5.00  $    7.39 $    9.05
Fourth Quarter 2007             26,370 $     5.25  $    7.74 $   11.14
First Quarter 2008              22,500 $     5.44  $    8.00 $   12.64
Second Quarter 2008             22,500 $     5.00  $    7.11 $    9.09
Third Quarter 2008              22,500 $     5.00  $    7.11 $    9.09
Fourth Quarter 2008             15,870 $     5.21  $    7.58 $   10.73
First Quarter 2009              10,000 $     5.50  $    8.00 $   12.60

                             (Bbls)
Crude Oil Costless Collars
Third Quarter 2007                 200             $   60.00 $   72.20
Fourth Quarter 2007                200             $   60.00 $   72.20

Crude Oil Swaps
Third Quarter 2007                 300             $   69.00
Fourth Quarter 2007                300             $   69.00
* A three-way collar contract consists of a collar contract plus a put
 option contract sold by PVA with a price below the floor price of the
 collar. This additional put requires PVA to make a payment to the
 counterparty if the settlement price for any settlement period is
 below the put option price. Combining the collar contract with the
 additional put option results in PVA's entitlement to a net payment
 equal to the difference between the floor price of the collar
 contract and the additional put option price if the settlement price
 is equal to or less than the additional put option price. If the
 settlement price is greater than the additional put option price, the
 result is the same as it would have been with a collar contract only.
 This strategy enables PVA to increase the floor and the ceiling price
 of the collar beyond the range of a traditional collar contract while
 defraying the associated cost with the sale of the additional put
 option.

2007 Second Quarter Financial Results Conference Call

A conference call and webcast, during which management will discuss second quarter 2007 financial and operational results for PVA, is scheduled for Thursday, August 2, 2007 at 3:00 p.m. ET. Prepared remarks by A. James Dearlove, President and Chief Executive Officer, will be followed by a question and answer period. Investors and analysts may participate via phone by dialing 1-877-407-9205 five to ten minutes before the scheduled start of the conference call, or via webcast by logging on to PVA's website at www.pennvirginia.com at least 20 minutes prior to the scheduled start of the call to download and install any necessary audio software. A telephone replay of the call will be available until August 16, 2007 at 11:59 p.m. ET by dialing 1-877-660-6853 and using the following replay pass codes: account #286, conference ID #248539. An on-demand replay of the conference call will be available at PVA's website beginning shortly after the call.

Headquartered in Radnor, PA and a member of the S&P SmallCap 600 Index, Penn Virginia Corporation (NYSE:PVA) is an independent natural gas and oil company focused on the exploration, acquisition, development and production of reserves in onshore regions of the U.S., including the Appalachian Basin, the Cotton Valley play in east Texas, the Selma Chalk play in Mississippi, the Mid-Continent region and the Gulf Coast of Louisiana and Texas. PVA also owns approximately 82 percent of Penn Virginia GP Holdings, L.P. (NYSE:PVG), the owner of the general partner and the largest unit holder of Penn Virginia Resource Partners, L.P. (NYSE:PVR), a manager of coal properties and related assets and the operator of a midstream natural gas gathering and processing business. For more information about PVA, please visit PVA's website at www.pennvirginia.com.

Certain statements contained herein that are not descriptions of historical facts are "forward-looking" statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Because such statements include risks, uncertainties and contingencies, actual results may differ materially from those expressed or implied by such forward-looking statements. These risks, uncertainties and contingencies include, but are not limited to, the following: the cost of finding and successfully developing oil and gas reserves; energy prices generally and specifically, the price of crude oil and natural gas; projected demand for crude oil and natural gas; the projected supply of crude oil and natural gas; our ability to obtain adequate pipeline transportation capacity for its oil and gas production; non-performance by third party operators in wells in which we own an interest; competition among producers in the oil and natural gas industry; the extent to which the amount and quality of actual production of our oil and natural gas differs from estimated recoverable proved oil and gas reserves; hazards or operating risks incidental to our business; unanticipated geological problems; the availability of required drilling rigs, materials and equipment; the occurrence of unusual weather or operating conditions including force majeure events; delays in anticipated start-up dates of the our oil and natural gas production; environmental risks affecting the drilling and producing of oil and gas wells; the timing of receipt of necessary governmental permits by us; labor relations and costs; accidents; changes in governmental regulation or enforcement practices; uncertainties relating to the outcome of current and future litigation regarding mine permitting; and risks and uncertainties relating to general domestic and international economic (including inflation and interest rates) and political conditions (including the impact of potential terrorist attacks).

Additional information concerning these and other factors can be found in our press releases and public periodic filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the year ended December 31, 2006. Many of the factors that will determine our future results are beyond the ability of management to control or predict. Readers should not place undue reliance on forward-looking statements, which reflect management's views only as of the date hereof. We undertake no obligation to revise or update any forward-looking statements, or to make any other forward-looking statements, whether as the result of new information, future events or otherwise.

Source: Penn Virginia Corporation