Penn Virginia Corporation Announces Third Quarter 2009 Results

RADNOR, Pa.-- Penn Virginia Corporation (NYSE:PVA) today reported financial and operational results for the three months ended September 30, 2009 and provided an update of full-year 2009 guidance.

Third Quarter 2009 Highlights

Third quarter 2009 results, with comparisons to third quarter 2008 results, included the following:

    --  Quarterly oil and gas production of 134.9 million cubic feet of natural
        gas equivalent (MMcfe) per day, or 12.4 billion cubic feet of natural
        gas equivalent (Bcfe), a six percent increase as compared to oil and gas
        production of 127.1 MMcfe per day, or 11.7 Bcfe;
    --  Increased 2009 guidance for production to a range of 49.0 to 51.0 Bcfe,
        or six to nine percent higher than 2008, as a result of better than
        expected third quarter volumes;
    --  Operating cash flow, a non-GAAP (generally accepted accounting
        principles) measure, of $64.0 million as compared to operating cash flow
        of $97.5 million;
    --  Adjusted net loss, a non-GAAP measure which excludes the effects of the
        non-cash change in derivatives fair value, drilling rig standby charges,
        impairments and gains or losses that affect comparability to the prior
        year period, of $11.2 million, or $0.25 per diluted share, as compared
        to adjusted net income of $14.0 million, or $0.33 per diluted share;
    --  Net loss attributable to PVA of $79.9 million, or $1.76 per diluted
        share, as compared to net income of $123.0 million, or $2.88 per diluted
        share. The third quarter of 2009 included an $87.9 million non-cash
        impairment charge on non-core properties held for sale, while the third
        quarter of 2008 included $154.9 million of a non-cash change in
        derivatives fair value and gains on the sale of assets; and
    --  Subsequent to the end of the third quarter, we completed the syndication
        of a new 3-year senior secured revolving credit facility with an initial
        undrawn commitment of $300 million supported by a $420 million approved
        borrowing base, a 14 percent increase over the current $367 million
        borrowing base.

Reconciliations of non-GAAP financial measures to GAAP-based measures appear in the financial tables later in this release.

Management Comment

A. James Dearlove, President and Chief Executive Officer, said, "Although declines in commodity prices and a decision to sell non-core properties in the Gulf Coast region impacted our financial results, we are pleased with our third quarter 2009 operational results. As detailed in our separate operational update, third quarter production was better than anticipated and, accordingly, we have increased full year 2009 production guidance. In addition, due to the improved outlook for natural gas, recent positive results in our core plays and our improved financial liquidity, we have resumed operated drilling in the Lower Bossier (Haynesville) Shale and Granite Wash plays.

"During the third quarter of 2009, we raised approximately $118 million from the sale of PVG units. As a result, we have substantially improved our financial liquidity, with $300 million of unused availability on our revolving credit facility and over $90 million of cash on hand. Furthermore, we expect to complete the sale of non-core properties, primarily along the Texas and Louisiana Gulf Coast, during the fourth quarter of 2009 which will further augment our cash liquidity. The net effect of both transactions is very positive to our cash and liquidity situation and better positions our company for future growth as a more focused, resource play-driven exploration and production company.

"Our commodity price hedges provided cash flow protection, increasing third quarter effective price realizations from $3.45 per Mcf to $4.90 per Mcf for natural gas. For the fourth quarter of 2009, we have hedged approximately 82 percent of our estimated natural gas production at average respective floor and ceiling prices of $6.41 and $8.11 per million British thermal units (MMBtu), and 57 percent of our estimated crude oil production at average floor and ceiling prices of approximately $80 and $120 per barrel. For 2010, we have hedged approximately 60 percent of our estimated natural gas production at average respective floor and ceiling prices of $6.09 and $8.19 per MMBtu, assuming flat production from the fourth quarter of 2009. In addition to the cash flow support our hedges have provided, our unit cash costs have continued to improve, including a 15 percent reduction from the prior year quarter and in line with the second quarter of 2009 in spite of the sequential production decline.

"In addition to our core oil and gas exploration and production business segment, we own 51 percent of Penn Virginia GP Holdings, L.P. (NYSE: PVG), which was reduced from 77 percent by our sale of PVG units during the third quarter. PVG owns the general partner of Penn Virginia Resource Partners, L.P. (NYSE: PVR) and is PVR's largest limited partner unitholder. As the owner of the general partner and largest unitholder of PVG, we report our financial results on a consolidated basis with the financial results of PVG. At current distribution rates, which have not changed since the third quarter of 2008, our ownership of PVG and PVR provides approximately $30 million of annualized pre-tax cash flow to us, which we re-deploy into our oil and gas segment."

Oil and Gas Segment Review

Third quarter oil and gas production grew six percent to 134.9 MMcfe per day, or 12.4 Bcfe, from 127.1 MMcfe per day, or 11.7 Bcfe, in the third quarter of 2008, and was nine percent lower than 148.9 MMcfe per day, or 13.6 Bcfe in the second quarter of 2009. See our separate operational update news release dated October 30, 2009 for a more detailed discussion of operations for the oil and gas segment.

During the third quarter of 2009, oil and gas segment operating income decreased by $203.6 million as compared to the prior year quarter to an operating loss of $114.6 million. The decrease was due to a $92.4 million increase in impairments, a $101.0 million, or 64 percent, decrease in revenues, a $7.8 million, or 93 percent, increase in exploration expense and a $2.5 million, or four percent, increase in other operating expenses. The decrease in revenues was due to sharp declines in realized commodity prices before considering support from related hedges - a 66 percent decrease in the natural gas price, a 44 percent decrease in the oil price and a 55 percent decrease in the price of natural gas liquids (NGLs) - offset in part by the six percent increase in oil and gas production.

The $102.7 million increase in operating expenses was due to an $87.9 million non-cash impairment charge on assets held for sale pertaining to the Gulf Coast region, a $6.7 million increase in depreciation, depletion and amortization (DD&A) expense, a $4.5 million impairment charge primarily related to Bakken properties in North Dakota and $3.7 million of rig standby charges. These increases in operating expenses were partially offset by a $2.4 million decrease in production taxes due to lower commodity prices and a $1.8 decrease in lease operating expenses despite the production increase. The impairment charge on the Gulf Coast properties relates to a reduction in the carrying value of the assets to a level which is in line with the expected proceeds from their sale, expected during the fourth quarter.

In the third quarter of 2009, total oil and gas segment expenses, excluding the impairment and rig standby charges, increased by $6.6 million, or 11 percent, to $74.3 million, or $5.99 per Mcfe produced, from $67.7 million, or $5.79 per Mcfe produced, in the third quarter of 2008, as discussed below:

    --  Third quarter 2009 cash operating expenses of $22.6 million, or $1.82
        per Mcfe produced, were $4.1 million, or 15 percent, lower than the
        $26.7 million, or $2.29 per Mcfe produced, in the third quarter of 2008.
        The decrease in unit cash operating expenses was primarily due to lower
        taxes other than income and lower lease operating expense, as discussed
        below:
        o Lease operating expense decreased 17 percent to $1.07 per Mcfe from
          $1.29 per Mcfe primarily due to decreased overall service costs due to
          sharply lower commodity prices and reduced water disposal and other
          costs as compared to the prior year quarter;
        o Taxes other than income decreased 39 percent to $0.34 per Mcfe from
          $0.56 per Mcfe primarily due to decreased severance taxes related to
          sharply lower commodity prices; and
        o Segment general and administrative (G&A) expense decreased seven
          percent to $0.41 per Mcfe as compared to $0.44 per Mcfe primarily due
          to the production increase.

    --  Exploration expense, excluding drilling rig standby charges discussed
        below, increased 49 percent to $12.4 million in the third quarter of
        2009, as compared to $8.3 million in the prior year quarter, primarily
        due to increased amortization of unproved properties related to higher
        leasehold acquisition costs in our East Texas, Mid-Continent and Gulf
        Coast regions.
    --  DD&A expense increased by $6.7 million, or 20 percent, to $39.3 million,
        or $3.17 per Mcfe, in the third quarter of 2009 from $32.7 million, or
        $2.79 per Mcfe, in the prior year quarter. The overall increase in DD&A
        expense was primarily due to the production increase and a higher
        depletion rate per unit of production. The higher depletion rate was
        primarily due to (i) higher drilling costs on our new horizontal plays
        and (ii) commodity price and performance-related downward reserve
        revisions in the non-core Gulf Coast fields, expected to be sold during
        the fourth quarter of 2009, and on early-stage wells in the Lower
        Bossier (Haynesville) Shale play.

In the first quarter of 2009, we opted to defer the drilling of wells in several of our plays due to unfavorable economic conditions. As a result, we amended certain drilling rig contracts to delay commencement of drilling until January 2010. In the third quarter of 2009, we expensed approximately $3.7 million for lump sum delay fees, minimum daily standby fees and demobilization fees expected to be paid during the standby period. Continued deferral of the rigs could result in additional standby expense of $0.5 to $1.5 million during the fourth quarter of 2009.

During the third quarter of 2009, we incurred approximately $92.4 million of impairments. These charges were primarily related to the $87.9 million write-down in value of proved properties in our Gulf Coast region to a carrying value that is in line with the expected proceeds from the anticipated sale of these assets, expected during the fourth quarter of 2009.

Coal & Natural Resource Management and Natural Gas Midstream Segment Review (PVR and PVG)

As the owner of the general partner and largest unitholder of PVG, we report our financial results on a consolidated basis with the financial results of PVG. A conversion of the GAAP-compliant financial statements ("As reported") to the equity method of accounting ("As adjusted") is included in the "Conversion to Non-GAAP Equity Method" table in this release. Using the equity method, PVG's results are reduced to a few line items and the results from oil and gas operations are therefore highlighted. We believe that the financial statements presented using the equity method are less complex and more comparable to those of other oil and gas exploration and production companies. Financial and operational results and full-year 2009 guidance for each of PVR's segments are provided in the financial tables later in this release. In addition, operational updates for these segments are discussed in more detail in PVR's news release dated November 4, 2009. Please visit PVR's website, www.pvresource.com, under "For Investors" for a copy of the release.

During the third quarter of 2009, we sold 10.0 million units of PVG to the public for net proceeds of $118.1 million. The net proceeds were used to repay the entire outstanding balance on our revolving credit facility and the remainder of approximately $68 million was held as cash. As a result, our position in PVG was reduced from 30.1 million units, or 77 percent, to 20.1 million units, or 51 percent.

As previously announced, on November 18, 2009, PVG will pay to unitholders of record as of November 6, 2009 a quarterly cash distribution of $0.38 per unit, or an annualized rate of $1.52 per unit, covering the period of July 1 through September 30, 2009. The distribution remains unchanged from the distribution paid with respect to each of the previous four quarters. As a result of PVG's distribution, we will receive a cash distribution of $7.6 million in the fourth quarter of 2009, or $30.5 million on an annualized basis.

Capital Resources, Credit Facility and Impact of Derivatives

We have completed the syndication of a new 3-year senior secured revolving credit facility with an initial undrawn commitment of $300 million supported by a $420 million approved borrowing base, a 14 percent increase over the current $367 million borrowing base. The new facility is provided by a syndicate of 12 banks, led by J.P. Morgan Securities Inc., with no individual bank holding more than ten percent of the total commitment. Pricing for the new credit facility will be unchanged from the existing facility. The credit facility will close subject to final document review by the bank group.

As of September 30, 2009, we had outstanding borrowings of $530.0 million ($496.4 million carrying value), consisting of $300 million ($291.4 million carrying value) of senior unsecured notes due 2016 and $230.0 million ($204.9 million carrying value) of convertible senior subordinated notes due 2012 and no borrowings against our revolving credit facility. The $32.0 million decrease in outstanding borrowings as compared to the $562.0 million at December 31, 2008 was primarily due to the repayment of revolver debt following a $64.9 million offering of PVA common shares in May 2009 and a $118.1 million offering of PVG common units in September 2009, as well as free cash flow during the third quarter of 2009, net of spending to fund our oil and gas capital expenditures during the first nine months of 2009. As of September 30, 2009, we had $300 million of unused availability on our revolving credit facility and over $90 million of cash on hand.

As of September 30, 2009, PVR had outstanding borrowings of $628.1 million under its $800 million revolving credit facility with remaining revolver borrowing capacity of $170.3 million. The $60.0 million increase in outstanding PVR borrowings as compared to $568.0 million outstanding as of December 31, 2008 was primarily due to PVR capital expenditures during the first nine months of 2009.

Consolidated interest expense increased from $13.2 million in the third quarter of 2008 to $22.8 million in the third quarter of 2009. The increase was due to a higher interest rate on the senior unsecured notes PVA issued in June 2009 and higher average level of outstanding borrowings during the third quarter of 2009 as compared to the prior year quarter.

Due to decreases in natural gas and crude oil prices experienced during the third quarter, the mark-to-market valuation of our and PVR's open hedging positions resulted in derivatives income of $2.5 million in the third quarter as compared to derivatives income of $125.1 million in the prior year quarter. Included in derivatives income for the third quarter of 2009 was $0.3 million of income related to our oil and gas segment and $2.8 million of expense related to PVR. Third quarter 2009 cash settlements of our oil and gas derivatives resulted in net cash receipts of $15.8 million, as compared to $5.7 million of net cash payments in the same quarter of 2008. PVR's third quarter 2009 cash settlements of commodity and interest rate derivatives result in net cash payments of $0.3 million, as compared to $14.1 million of net cash payments in the same quarter of 2008.

Guidance for 2009

See the Guidance Table included in this release for guidance estimates for full-year 2009. These estimates, including capital expenditure plans, which were discussed in our operational update, are meant to provide guidance only and are subject to revision as our and PVR's operating environments change.

Third Quarter 2009 Financial and Operational Results Conference Call

A conference call and webcast, during which management will discuss third quarter 2009 financial and operational results, is scheduled for Thursday, November 5, 2009 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 1-866-630-9986 five to ten minutes before the scheduled start of the conference call and using the passcode 4836740, or via webcast by logging on to our 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 telephonic replay will be available approximately two hours after the call for two weeks by dialing toll free 888-203-1112 (international: 719-457-0820) and using the replay code 4836740. In addition, an on-demand replay of the webcast will also be available for two weeks at PVG's or PVR's websites beginning 24 hours after the webcast.

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 East Texas, Mississippi, the Mid-Continent region and the Appalachian Basin. We also own approximately 51 percent of PVG, the owner of the general partner and the largest unit holder of PVR, a manager of coal and natural resource properties and related assets and the operator of a midstream natural gas gathering and processing business.

For more information, 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 volatility of commodity prices for natural gas, NGLs, crude oil and coal; our ability to access external sources of capital; uncertainties relating to the occurrence and success of capital-raising transactions, including securities offerings and asset sales; reductions in the borrowing base under our Revolver; our ability to develop and replace oil and gas reserves and the price for which such reserves can be acquired; any impairment write-downs of our reserves or assets; reductions in our anticipated capital expenditures; the relationship between natural gas, NGL, crude oil and coal prices; the projected demand for and supply of natural gas, NGLs, crude oil and coal; the availability and costs of required drilling rigs, production equipment and materials; our ability to obtain adequate pipeline transportation capacity for our oil and gas production; competition among producers in the oil and natural gas and coal industries generally and among natural gas midstream companies; the extent to which the amount and quality of actual production of our oil and natural gas or PVR's coal differ from estimated proved oil and gas reserves and recoverable coal reserves; PVR's ability to generate sufficient cash from its businesses to maintain and pay the quarterly distribution to its general partner and its unitholders; the experience and financial condition of PVR's coal lessees and natural gas midstream customers, including the lessees' ability to satisfy their royalty, environmental, reclamation and other obligations to PVR and others; whether the sale of our Gulf Coast assets closes during the fourth quarter and at the anticipated price; operating risks, including unanticipated geological problems, incidental to our business and to PVR's coal or natural gas midstream businesses; PVR's ability to acquire new coal reserves or natural gas midstream assets and new sources of natural gas supply and connections to third-party pipelines on satisfactory terms; PVR's ability to retain existing or acquire new natural gas midstream customers and coal lessees; the ability of PVR's lessees to produce sufficient quantities of coal on an economic basis from PVR's reserves and obtain favorable contracts for such production; the occurrence of unusual weather or operating conditions including force majeure events; delays in anticipated start-up dates of our oil and natural gas production, of PVR's lessees' mining operations and related coal infrastructure projects and new processing plants in PVR's natural gas midstream business; environmental risks affecting the drilling and producing of oil and gas wells, the mining of coal reserves or the production, gathering and processing of natural gas; the timing of receipt of necessary governmental permits by us and by PVR or PVR's lessees; hedging results; accidents; changes in governmental regulation or enforcement practices, especially with respect to environmental, health and safety matters, including with respect to emissions levels applicable to coal-burning power generators; uncertainties relating to the outcome of current and future litigation regarding mine permitting; risks and uncertainties relating to general domestic and international economic (including inflation, interest rates and financial and credit markets) and political conditions (including the impact of potential terrorist attacks); PVG's ability to generate sufficient cash from its interests in PVR to maintain and pay the quarterly distribution to its unitholders; uncertainties relating to our continued ownership of interests in PVG and PVR; and other risks set forth in our Annual Report on Form 10-K for the fiscal year ended December 31, 2008.

Additional information concerning these and other factors can be found in our press releases and public periodic filings with the SEC, including our Annual Report on Form 10-K for the year ended December 31, 2008. 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 a result of new information, future events or otherwise.


PENN VIRGINIA CORPORATION

CONSOLIDATED STATEMENTS OF EARNINGS - unaudited

(in thousands, except per share data)

                            Three Months Ended         Nine Months Ended

                            September 30,              September 30,

                            2009          2008 (a)     2009          2008 (a)

Revenues

Natural gas                 $ 36,654      $ 101,911    $ 129,305     $ 295,636

Crude oil                     13,259        13,764       31,412        37,442

Natural gas liquids (NGLs)    2,847         10,481       10,553        18,887

Natural gas midstream         102,262       184,914      289,123       494,260

Coal royalties                29,821        33,308       90,448        88,911

Gain on sale of property      1,945         31,279       1,918         31,335
and equipment

Other                         8,375         9,955        25,481        28,690

Total revenues                195,163       385,612      578,240       995,161

Expenses

Cost of midstream gas         77,248        155,564      228,579       408,247
purchased

Operating                     21,167        23,437       66,517        66,653

Exploration                   12,405        8,346        34,587        19,765

Exploration - drilling rig    3,712         -            20,314        -
standby charges - (b)

Taxes other than income       5,294         7,671        16,656        23,325

General and administrative
(excluding equity             16,309        16,211       47,481        49,299
compensation)

Equity-based compensation     3,637         2,078        11,306        5,707
- (c)

Depreciation, depletion       57,869        49,978       173,160       133,481
and amortization

Impairments on assets held    87,900        -            87,900        -
for sale

Impairments                   4,453         -            8,928         -

Loss on sale of assets        -             -            1,599         -

Total expenses                289,994       263,285      697,027       706,477

Operating income (loss)       (94,831  )    122,327      (118,787 )    288,684

Other income (expense)

Interest expense              (22,784  )    (13,221 )    (50,332  )    (35,313 )

Derivatives                   (2,529   )    125,132      8,478         (4,387  )

Other                         348           (4,088  )    2,274         (782    )

Income (loss) before
income taxes and              (119,796 )    230,150      (158,367 )    248,202
noncontrolling interests

Income tax benefit            50,405        (78,921 )    69,587        (74,352 )
(expense)

Net income (loss)           $ (69,391  )  $ 151,229    $ (88,780  )  $ 173,850

Less net income
attributable to               (10,509  )    (28,276 )    (20,512  )    (52,252 )
noncontrolling interests

Income (loss) attributable  $ (79,900  )  $ 122,953    $ (109,292 )  $ 121,598
to PVA

Income (loss) per share
attributable to PVA

Basic                       $ 1.76        $ 2.94       $ 2.52        $ 2.91

Diluted                     $ 1.76        $ 2.88       $ 2.52        $ 2.88

Weighted average shares       45,427        41,881       43,324        41,715
outstanding, basic

Weighted average shares       45,427        42,544       43,324        42,028
outstanding, diluted

                            Three Months Ended         Nine Months Ended

                            September 30,              September 30,

                            2009          2008         2009          2008

Production

Natural gas (MMcf)            10,634        10,046       33,858        29,869

Crude oil (MBbls)             202           117          588           331

NGLs (MBbls)                  94            157          381           300

Total natural gas, crude
oil and NGL production        12,410        11,690       39,672        33,655
(MMcfe)

Prices

Natural gas ($ per Mcf)     $ 3.45        $ 10.14      $ 3.82        $ 9.90

Crude oil ($ per Bbl)       $ 65.64       $ 117.64     $ 53.42       $ 113.12

NGLs ($ per Bbl)            $ 30.29       $ 66.76      $ 27.70       $ 62.96




(a) As a result of adopting accounting guidance for convertible debt
instruments that may be settled in cash upon conversion (including partial cash
settlement), we are required to present our results of operations
retrospectively as if the standard had been in effect for all periods
presented.

(b) Drilling rig standby charges represent fees paid in connection with the
deferral of drilling associated with contractually committed rigs and frac tank
rentals.

(c) Our equity-based compensation expense includes our stock option expense and
the amortization of restricted stock and restricted stock units related to
employee awards in accordance with accounting guidance of share-based payments.




PENN VIRGINIA CORPORATION

CONSOLIDATED BALANCE SHEETS - unaudited

(in thousands)

                                            September 30,  December 31,

                                            2009           2008

Assets

Current assets                              $ 293,483      $ 263,518

Net property and equipment                    2,372,323      2,512,177

Other assets                                  235,463        220,870

Total assets                                $ 2,901,269    $ 2,996,565

Liabilities and shareholders' equity

Current liabilities                         $ 145,356      $ 247,594

Long-term debt of PVR                         628,100        568,100

Revolving credit facility                     -              332,000

Senior notes                                  291,432        -

Convertible notes                             204,935        199,896

Other liabilities and deferred taxes          268,834        312,645

PVA shareholders' equity                      1,029,381      1,039,103

Noncontrolling interests                      333,231        297,227

Total shareholders' equity                    1,362,612      1,336,330

Total liabilities and shareholders' equity  $ 2,901,269    $ 2,996,565




CONSOLIDATED STATEMENTS OF CASH FLOWS - unaudited

(in thousands)

                             Three Months Ended         Nine Months Ended

                             September 30,              September 30,

                             2009         2008          2009          2008

Cash flows from operating
activities

Net income (loss)          $ (69,391 )  $ 151,229     $ (88,780  )  $ 173,850

Adjustments to reconcile
net income (loss) to net
cash provided by
operating activities:

Depreciation, depletion      57,869       49,978        173,160       133,481
and amortization

Impairments                  92,353       -             96,828        -

Derivative contracts:

Total derivative losses      6,312        (123,628 )    (2,821   )    8,516
(gains)

Cash receipts (payments)     15,507       (19,755  )    51,936        (46,740  )
to settle derivatives

Deferred income taxes        (51,928 )    61,552        (70,728  )    60,105

Dry hole and unproved        10,593       5,520         30,476        14,992
leasehold expense

Other                        2,685        (27,374  )    16,064        (26,118  )

Operating cash flow (see
attached table

"Certain Non-GAAP            64,000       97,522        206,135       318,086
Financial Measures")

Changes in operating         20,046       (5,727   )    15,888        (41,399  )
assets and liabilities

Net cash provided by         84,046       91,795        222,023       276,687
operating activities

Cash flows from investing
activities

Acquisitions                 (32,068 )    (162,078 )    (38,261  )    (278,185 )

Additions to property and    (25,363 )    (162,857 )    (218,558 )    (392,031 )
equipment

Other                        2,876        33,215        8,698         33,954

Net cash used in             (54,555 )    (291,720 )    (248,121 )    (636,262 )
investing activities

Cash flows from financing
activities

Dividends paid               (2,559  )    (2,351   )    (7,278   )    (7,037   )

Distributions paid to
noncontrolling interest      (18,455 )    (17,917  )    (55,365  )    (45,829  )
holders

Proceeds from (repayments    -            46,431        (7,542   )    46,431
of) bank borrowings

Net proceeds from
(repayments of) PVA          (70,000 )    (25,000  )    (332,000 )    58,000
borrowings

Net proceeds from PVR        31,000       176,600       60,000        146,000
borrowings

Net proceeds from
issuance of PVA senior       -            -             291,009       -
notes

Net proceeds from
issuance of PVR partners'    -            -             -             138,015
capital

Net proceeds from sale of    118,080      -             118,080       -
PVG units

Net proceeds from            -            -             64,835        -
issuance of PVA equity

Other                        (860    )    (2,311   )    (18,945  )    8,475

Net cash provided by         57,206       175,452       112,794       344,055
financing activities

Net increase (decrease)
in cash and cash             86,697       (24,473  )    86,696        (15,520  )
equivalents

Cash and cash equivalents    18,337       43,480        18,338        34,527
- beginning of period

Cash and cash equivalents  $ 105,034    $ 19,007      $ 105,034     $ 19,007
- end of period





PENN VIRGINIA CORPORATION

QUARTERLY SEGMENT INFORMATION - unaudited

(in thousands except where noted)

Three Months
Ended           Oil and Gas
September 30,                             Coal and
2009                                      Natural     Natural
                                          Resource    Gas        Other        Consolidated
                                          Management  Midstream
                Amount        per Mcfe
                              (a)


Production

Total natural
gas, crude oil    12,410
and NGLs
(MMcfe)

Natural gas       10,634
(MMcf)

Crude oil         202
(MBbls)

NGLs (MBbls)      94

Coal royalty
tons                                        8,387
(thousands of
tons)

Midstream
system                                                  29,811
throughput
volumes (MMcf)

Revenues

Natural gas     $ 36,654      $ 3.45      $ -         $ -        $ -          $ 36,654

Crude oil         13,259        65.64       -           -          -            13,259

NGLs              2,847         30.29       -           -          -            2,847

Natural gas       -                         -           118,443    (16,181 )    102,262
midstream

Coal royalties    -                         29,821      -          -            29,821

Gain on sale
of property       1,945                     -           -          -            1,945
and equipment

Other             1,043                     5,358       2,003      (29     )    8,375

Total revenues    55,748        4.49        35,179      120,446    (16,210 )    195,163

Expenses

Cost of
midstream gas     -                         -           92,355     (15,107 )    77,248
purchased

Operating         13,277        1.07        2,146       6,884      (1,140  )    21,167
expense

Exploration       12,405        1.00        -           -          -            12,405

Exploration -
drilling rig      3,712         0.30        -           -          -            3,712
standby
charges

Taxes other       4,186         0.34        421         584        103          5,294
than income

General and       5,133         0.41        3,388       4,180      7,245        19,946
administrative

Depreciation,
depletion and     39,326        3.17        7,999       9,852      692          57,869
amortization

Impairments on
assets held       87,900        7.08        -           -          -            87,900
for sale

Impairments       4,453         0.36        -           -          -            4,453

Total expenses    170,392       13.73       13,954      113,855    (8,207  )    289,994

Operating       $ (114,644 )  $ (9.24  )  $ 21,225    $ 6,591    $ (8,003  )  $ (94,831 )
income (loss)

Additions to
property and    $ 18,059                  $ 140       $ 39,031   $ 201        $ 57,431
equipment

Three Months
Ended           Oil and Gas
September 30,                             Coal and
2008                                      Natural     Natural
                                          Resource    Gas        Other        Consolidated
                                          Management  Midstream
                Amount        per Mcfe
                              (a)


Production

Total natural
gas, crude oil    11,690
and NGLs
(MMcfe)

Natural gas       10,046
(MMcf)

Crude oil         117
(MBbls)

NGLs (MBbls)      157

Coal royalty
tons                                        8,496
(thousands of
tons)

Midstream
system                                                  27,744
throughput
volumes (MMcf)

Revenues

Natural gas     $ 101,911     $ 10.14     $ -         $ -        $ -          $ 101,911

Crude oil         13,764        117.64      -           -          -            13,764

NGLs              10,481        66.76       -           -          -            10,481

Natural gas       -                         -           241,282    (56,368 )    184,914
midstream

Coal royalties    -                         33,308      -          -            33,308

Gain on sale
of property       30,509                    770                                 31,279
and equipment

Other             60                        7,582       2,334      (21     )    9,955

Total revenues    156,725       13.41       41,660      243,616    (56,389 )    385,612

Expenses

Cost of
midstream gas     -                         -           211,262    (55,698 )    155,564
purchased

Operating         15,067        1.29        2,877       6,164      (671    )    23,437
expense

Exploration       8,346         0.71        -           -          -            8,346

Taxes other       6,537         0.56        373         596        165          7,671
than income

General and       5,122         0.44        3,321       3,757      6,089        18,289
administrative

Depreciation,
depletion and     32,665        2.79        8,794       8,109      410          49,978
amortization

Total expenses    67,737        5.79        15,365      229,888    (49,705 )    263,285

Operating       $ 88,988      $ 7.62      $ 26,295    $ 13,728   $ (6,684  )  $ 122,327
income (loss)

Additions to
property and    $ 213,573                 $ 497       $ 110,606  $ 259        $ 324,935
equipment




(a) Natural gas revenues are shown per Mcf, crude oil and NGL revenues are
shown per Bbl, and all other amounts are shown per Mcfe.





PENN VIRGINIA CORPORATION

YEAR-TO-DATE SEGMENT INFORMATION - unaudited

(in thousands except where noted)

Nine Months
Ended           Oil and Gas               Coal and
September 30,                             Natural     Natural
2009                                      Resource    Gas
                                          Management  Midstream
                Amount        per Mcfe               Other                  Consolidated
                              (a)

Production

Total natural
gas, crude oil    39,672
and NGLs
(MMcfe)

Natural gas       33,858
(MMcf)

Crude oil         588
(MBbls)

NGLs (MBbls)      381

Coal royalty
tons                                        25,874
(thousands of
tons)

Midstream
system                                                  93,433
throughput
volumes (MMcf)

Revenues

Natural gas     $ 129,305     $ 3.82      $ -         $ -        $ -           $         129,305

Crude oil         31,412        53.42       -           -          -                     31,412

NGLs              10,553        27.70       -           -          -                     10,553

Natural gas       -                         -           348,882    (59,759  )            289,123
midstream

Coal royalties    -                         90,448      -          -                     90,448

Gain on sale
of property       1,918                     -           -          -                     1,918
and equipment

Other             2,904                     18,127      4,346      104                   25,481

Total revenues    176,092       4.44        108,575     353,228    (59,655  )            578,240

Expenses

Cost of
midstream gas     -                         -           285,129    (56,550  )            228,579
purchased

Operating         42,788        1.08        6,580       20,358     (3,209   )            66,517
expense

Exploration       34,587        0.87        -           -          -                     34,587

Exploration -
drilling rig      20,314        0.51        -           -          -                     20,314
standby
charges

Taxes other       12,756        0.32        1,146       2,062      692                   16,656
than income

General and       15,970        0.40        10,760      12,661     19,396                58,787
administrative

Depreciation,
depletion and     119,242       3.04        23,557      28,414     1,947                 173,160
amortization

Impairments on
assets held       87,900        2.22        -           -          -                     87,900
for sale

Impairments       8,928         0.23        -           -          -                     8,928

Other             1,599         0.04        -           -          -                     1,599

Total expenses    344,084       8.67        42,043      348,624    (37,724  )            697,027

Operating       $ (167,992 )  $ (4.23  )  $ 66,532    $ 4,604    $ (21,931  )  $         (118,787 )
income (loss)

Additions to
property and    $ 181,873                 $ 2,046     $ 71,245   $ 1,655       $         256,819
equipment

Nine Months
Ended           Oil and Gas               Coal and
September 30,                             Natural     Natural
2008                                      Resource    Gas
                                          Management  Midstream
                Amount        per Mcfe               Other                  Consolidated
                              (a)

Production

Total natural
gas, crude oil    33,655
and NGLs
(MMcfe)

Natural gas       29,869
(MMcf)

Crude oil         331
(MBbls)

NGLs (MBbls)      300

Coal royalty
tons                                        24,975
(thousands of
tons)

Midstream
system                                                  68,915
throughput
volumes (MMcf)

Revenues

Natural gas     $ 295,636     $ 9.90      $ -         $ -        $ -           $         295,636

Crude oil         37,442        113.12      -           -          -                     37,442

NGLs              18,887        62.96       -           -          -                     18,887

Natural gas       -                         -           601,127    (106,867 )            494,260
midstream

Coal royalties    -                         88,911      -          -                     88,911

Gain on sale
of property       30,543                    -           -          -                     30,543
and equipment

Other             883                       22,099      6,458      42                    29,482

Total revenues    383,391       11.39       111,010     607,585    (106,825 )            995,161

Expenses

Cost of
midstream gas     -                         -           513,778    (105,531 )            408,247
purchased

Operating         43,370        1.29        9,522       15,031     (1,270   )            66,653
expense

Exploration       19,765        0.59        -           -          -                     19,765

Taxes other       19,480        0.58        1,115       1,902      828                   23,325
than income

General and       14,869        0.44        9,780       10,559     19,798                55,006
administrative

Depreciation,
depletion and     90,849        2.70        22,733      18,589     1,310                 133,481
amortization

Total expenses    188,333       5.60        43,150      559,859    (84,865  )            706,477

Operating       $ 195,058     $ 5.79      $ 67,860    $ 47,726   $ (21,960  )  $         288,684
income (loss)

Additions to
property and    $ 422,975                 $ 25,186    $ 220,997  $ 1,058       $         670,216
equipment




(a) Natural gas revenues are shown per Mcf, crude oil and NGL revenues are shown
per Bbl, and all other amounts are shown per Mcfe.




PENN VIRGINIA CORPORATION

CERTAIN NON-GAAP FINANCIAL MEASURES - unaudited

(in thousands)

                            Three Months Ended         Nine Months Ended

                            September 30,              September 30,

                            2009         2008          2009          2008

Reconciliation of GAAP
"Net cash provided by
operating activities" to
Non-GAAP "Operating cash
flow"

Net cash provided by        $ 84,046     $ 91,795      $ 222,023     $ 276,687
operating activities

Adjustments:

Changes in operating          (20,046 )    5,727         (15,888  )    41,399
assets and liabilities

Operating cash flow (a)     $ 64,000     $ 97,522      $ 206,135     $ 318,086

Reconciliation of GAAP
"Net income (loss)
attributable to PVA" to
Non-GAAP "Net income
(loss) attributable to
PVA, as adjusted"

Net income (loss)           $ (79,900 )  $ 122,953     $ (109,292 )  $ 121,598
attributable to PVA

Adjustments for
derivatives:

Derivative losses (gains)     6,312        (123,628 )    (2,821   )    8,516
included in income

Cash receipts (payments)      15,507       (19,755  )    51,936        (46,740 )
to settle derivatives

Adjustment for drilling       3,712        -             20,314        -
rig standby charges

Adjustment for impairments    92,353       -             96,828        -

Adjustment for net gains      (1,945  )    (31,279  )    (319     )    (31,335 )
on sale of assets

Impact of adjustments on      (2,579  )    16,755        (9,494   )    13,649
noncontrolling interests

Impact of adjustments on      (44,621 )    49,139        (60,859  )    9,339
income taxes

                            $ (11,161 )  $ 14,185      $ (13,707  )  $ 75,027

Less: Portion of
subsidiary net income
(loss) allocated to           (44     )    (219     )    (68      )    (418    )
undistributed share-based
compensation awards, net
of taxes

Net income (loss)
attributable to PVA, as     $ (11,205 )  $ 13,966      $ (13,775  )  $ 74,609
adjusted (b)

Net income (loss)
attributable to PVA, as     $ (0.25   )  $ 0.33        $ (0.32    )  $ 1.78
adjusted, per share,
diluted




(a) Operating cash flow represents net cash provided by operating activities
before changes in operating assets and liabilities. We believe that operating
cash flow is widely accepted as a financial indicator of an energy company's
ability to generate cash which is used to internally fund investing activities,
service debt and pay dividends. Operating cash flow is widely used by investors
and professional research analysts in the valuation, comparison, rating and
investment recommendations of companies within the energy industry. Operating
cash flow is presented because we believe it is a useful adjunct to net cash
provided by operating activities under GAAP. Operating cash flow is not a
measure of financial performance under GAAP and should not be considered as an
alternative to cash flows from operating, investing or financing activities, as
an indicator of cash flows, as a measure of liquidity or as an alternative to
net income.

(b) Net income (loss) attributable to PVA, as adjusted, represents net income
(loss) attributable to PVA adjusted to exclude the effects of non-cash changes
in the fair value of derivatives, drilling rig standby charges, impairments,
gains and losses on the sale of assets, and net income of PVR allocated to
unvested PVR restricted units awarded as equity compensation that we hold until
vesting. We believe this presentation is commonly used by investors and
professional research analysts in the valuation, comparison, rating and
investment recommendations of companies within the oil and gas exploration and
production industry, as well as companies within the natural gas midstream
industry. We use this information for comparative purposes within these
industries. Net income (loss) attributable to PVA, as adjusted, is not a
measure of financial performance under GAAP and should not be considered as a
measure of liquidity or as an alternative to net income attributable to PVA.





PENN VIRGINIA CORPORATION

CONVERSION TO NON-GAAP EQUITY METHOD - unaudited

(in thousands)

Reconciliation of GAAP "Income Statements As Reported" to Non-GAAP "Income Statements, as Adjusted"
(a):

                Three Months Ended September 30, 2009       Three Months Ended September 30, 2008

                As Reported    Adjustments    As Adjusted   As Reported   Adjustments    As Adjusted

Revenues

Natural gas     $ 36,654       $ -            $ 36,654      $ 101,911     $ -            $ 101,911

Crude oil         13,259         -              13,259        13,764        -              13,764

NGLs              2,847          -              2,847         10,481        -              10,481

Natural gas       102,262        (102,262 )     -             184,914       (184,914 )     -
midstream

Coal royalties    29,821         (29,821  )     -             33,308        (33,308  )     -

Other             10,320         (7,361   )     2,959         41,234        (10,686  )     30,548

Total revenues    195,163        (139,444 )     55,719        385,612       (228,908 )     156,704

Expenses

Cost of
midstream gas     77,248         (77,248  )     -             155,564       (155,564 )     -
purchased

Operating         21,167         (9,030   )     12,137        23,437        (8,371   )     15,066

Exploration       12,405         -              12,405        8,346         -              8,346

Exploration -
drilling rig      3,712          -              3,712         -             -              -
standby
charges

Taxes other       5,294          (1,005   )     4,289         7,671         (969     )     6,702
than income

General and       19,946         (8,481   )     11,465        18,289        (7,618   )     10,671
administrative

Depreciation,
depletion and     57,869         (17,851  )     40,018        49,978        (16,903  )     33,075
amortization

Impairments on
properties        87,900         -              87,900        -             -              -
held for sale

Impairments       4,453          -              4,453         -             -              -

Loss on sale      -              -              -             -             -              -
of assets

Total expenses    289,994        (113,615 )     176,379       263,285       (189,425 )     73,860

Operating         (94,831  )     (25,829  )     (120,660 )    122,327       (39,483  )     82,844
income (loss)

Other income
(expense)

Interest          (22,784  )     6,505          (16,279  )    (13,221 )     7,060          (6,161  )
expense

Derivatives       (2,529   )     2,810          281           125,132       (15,742  )     109,390

Equity
earnings in       -              6,349          6,349         -             15,771         15,771
PVG and PVR

Other             348            (344     )     4             (4,088  )     4,118          30

Income (loss)
before taxes
and               (119,796 )     (10,509  )     (130,305 )    230,150       (28,276  )     201,874
noncontrolling
interests

Income tax
benefit           50,405         -              50,405        (78,921 )     -              (78,921 )
(expense)

Net income        (69,391  )     (10,509  )     (79,900  )    151,229       (28,276  )     122,953
(loss)

Less net
income
attributable      (10,509  )     10,509         -             (28,276 )     28,276         -
to
noncontrolling
interests

Net income
(loss)          $ (79,900  )   $ -            $ (79,900  )  $ 122,953     $ -            $ 122,953
attributable
to PVA

                Nine Months Ended September 30, 2009        Nine Months Ended September 30, 2008

                As Reported    Adjustments    As Adjusted   As Reported   Adjustments    As Adjusted

Revenues

Natural gas     $ 129,305      $ -            $ 129,305     $ 295,636     $ -            $ 295,636

Crude oil         31,412         -              31,412        37,442        -              37,442

NGLs              10,553         -              10,553        18,887        -              18,887

Natural gas       289,123        (289,123 )     -             494,260       (494,260 )     -
midstream

Coal royalties    90,448         (90,448  )     -             88,911        (88,911  )     -

Other             27,399         (22,473  )     4,926         60,025        (28,557  )     31,468

Total revenues    578,240        (402,044 )     176,196       995,161       (611,728 )     383,433

Expenses

Cost of
midstream gas     228,579        (228,579 )     -             408,247       (408,247 )     -
purchased

Operating         66,517         (26,938  )     39,579        66,653        (23,217  )     43,436

Exploration       34,587         -              34,587        19,765        -              19,765

Exploration -
drilling rig      20,314         -              20,314        -             -              -
standby
charges

Taxes other       16,656         (3,208   )     13,448        23,325        (3,017   )     20,308
than income

General and       58,787         (25,433  )     33,354        55,006        (22,057  )     32,949
administrative

Depreciation,
depletion and     173,160        (51,971  )     121,189       133,481       (41,322  )     92,159
amortization

Impairments on
assets held       87,900         -              87,900        -             -              -
for sale

Impairments       8,928          -              8,928         -             -              -

Loss on sale      1,599          -              1,599         -             -              -
of assets

Total expenses    697,027        (336,129 )     360,898       706,477       (497,860 )     208,617

Operating         (118,787 )     (65,915  )     (184,702 )    288,684       (113,868 )     174,816
income (loss)

Other income
(expense)

Interest          (50,332  )     18,486         (31,846  )    (35,313 )     17,366         (17,947 )
expense

Derivatives       8,478          12,005         20,483        (4,387  )     6,424          2,037

Equity
earnings in       -              15,932         15,932        -             34,754         34,754
PVG and PVR

Other             2,274          (1,020   )     1,254         (782    )     3,072          2,290

Income (loss)
before taxes
and               (158,367 )     (20,512  )     (178,879 )    248,202       (52,252  )     195,950
noncontrolling
interests

Income tax
benefit           69,587         -              69,587        (74,352 )     -              (74,352 )
(expense)

Net income        (88,780  )     (20,512  )     (109,292 )    173,850       (52,252  )     121,598
(loss)

Less net
income
attributable      (20,512  )     20,512         -             (52,252 )     52,252         -
to
noncontrolling
interests

Net income
(loss)          $ (109,292 )   $ -            $ (109,292 )  $ 121,598     $ -            $ 121,598
attributable
to PVA




(a) Equity method income statements represent consolidated income statements,
minus 100% of PVG's consolidated results of operations, plus noncontrolling
interests which represents the portion of PVG's consolidated results of
operations that we do not own. We believe equity method income statements
provide useful information to allow the public to more easily discern PVG's
effect on our operations.





PENN VIRGINIA CORPORATION

CONVERSION TO NON-GAAP EQUITY METHOD - unaudited (continued)

(in thousands)

Reconciliation of GAAP "Balance Sheet As Reported" to Non-GAAP "Balance Sheet, as Adjusted" (a):

                       September 30, 2009                            December 31, 2008

                       As Reported    Adjustments     As Adjusted    As Reported    Adjustments   As Adjusted

Assets

Current assets         $ 293,483      $ (92,843    )  $ 200,640      $ 263,518      $ (126,299 )  $ 137,219

Net property and         2,372,323      (909,994   )    1,462,329      2,512,177      (895,119 )    1,617,058
equipment

Equity investment in     -              158,276         158,276        -              248,211       248,211
PVG and PVR

Other assets             235,463        (215,937   )    19,526         220,870        (206,256 )    14,614

Total assets           $ 2,901,269    $ (1,060,498 )  $ 1,840,771    $ 2,996,565    $ (979,463 )  $ 2,017,102

Liabilities and
shareholders' equity

Current liabilities    $ 145,356      $ (70,873    )  $ 74,483       $ 247,594      $ (89,908  )  $ 157,686

Long-term debt           1,124,467      (628,100   )    496,367        1,099,996      (568,100 )    531,896

Other liabilities and    268,834        (28,294    )    240,540        312,645        (24,228  )    288,417
deferred taxes

                                                                                                    -

PVA shareholders'        1,029,381      -               1,029,381      1,039,103      -             1,039,103
equity

Noncontrolling           333,231        (333,231   )    -              297,227        (297,227 )    -
interests

Total shareholders'      1,362,612      (333,231   )    1,029,381      1,336,330      (297,227 )    1,039,103
equity

Total liabilities and  $ 2,901,269    $ (1,060,498 )  $ 1,840,771    $ 2,996,565    $ (979,463 )  $ 2,017,102
shareholders' equity

Reconciliation of GAAP "Statement of Cash Flows As Reported" to Non-GAAP "Statement of Cash Flows, as Adjusted"
(b):

                       Three Months Ended September 30, 2009         Three Months Ended September 30, 2008

                       As Reported    Adjustments     As Adjusted    As Reported    Adjustments   As Adjusted

Cash flows from
operating activities

Net income (loss)      $ (69,391   )  $ -             $ (69,391   )  $ 151,229      $ -           $ 151,229

Adjustments to
reconcile net income
(loss) to net cash
provided by operating
activities:

Depreciation,
depletion and            57,869         (17,851    )    40,018         49,978         (16,903  )    33,075
amortization

Impairments              92,353         -               92,353         -              -             -

Derivative contracts:

Total derivative         6,312          (3,668     )    2,644          (123,628  )    14,239        (109,389  )
losses (gains)

Cash receipts
(payments) to settle     15,507         314             15,821         (19,755   )    14,054        (5,701    )
derivatives

Deferred income taxes    (51,928   )                    (51,928   )    61,552         -             61,552

Dry hole and unproved    10,593         -               10,593         5,520          -             5,520
leasehold expense

Investment in PVG and    -              (18,470    )    (18,470   )    -              (44,047  )    (44,047   )
PVR

Cash distributions       -              11,868          11,868         -              10,967        10,967
from PVG and PVR

Other                    2,685          (1,232     )    1,453          (27,374   )    1,130         (26,244   )

Operating cash flow      64,000         (29,039    )    34,961         97,522         (20,560  )    76,962

Changes in operating
assets and               20,046         (1,892     )    18,154         (5,727    )    10,853        5,126
liabilities

Net cash provided by     84,046         (30,931    )    53,115         91,795         (9,707   )    82,088
operating activities

Net cash used in         (54,555   )    38,871          (15,684   )    (291,720  )    171,871       (119,849  )
investing activities

                                                                                                    -

Net cash provided by     57,206         (12,545    )    44,661         175,452        (155,229 )    20,223
financing activities

Net increase
(decrease) in cash       86,697         (4,605     )    82,092         (24,473   )    6,935         (17,538   )
and cash equivalents

Cash and cash
equivalents-beginning    18,337         (17,093    )    1,244          43,480         (25,942  )    17,538
balance

Cash and cash
equivalents-ending     $ 105,034      $ (21,698    )  $ 83,336       $ 19,007       $ (19,007  )  $ -
balance

                       Nine Months Ended September 30, 2009          Nine Months Ended September 30, 2008

                       As Reported    Adjustments     As Adjusted    As Reported    Adjustments   As Adjusted

Cash flows from
operating activities

Net income (loss)      $ (88,780   )  $ -             $ (88,780   )  $ 173,850      $ -           $ 173,850

Adjustments to
reconcile net income
(loss) to net cash
provided by operating
activities:

Depreciation,
depletion and            173,160        (51,971    )    121,189        133,481        (41,322  )    92,159
amortization

Impairments              96,828         -               96,828         -              -             -

Derivative contracts:

Total derivative         (2,821    )    (14,234    )    (17,055   )    8,516          (10,552  )    (2,036    )
losses (gains)

Cash settlements of      51,936         (4,135     )    47,801         (46,740   )    33,279        (13,461   )
derivatives

Deferred income taxes    (70,728   )    -               (70,728   )    60,105         -             60,105

Dry hole and unproved    30,476         -               30,476         14,992         -             14,992
leasehold expense

Investment in PVG and    -              (40,191    )    (40,191   )    -              (87,006  )    (87,006   )
PVR

Cash distributions       -              34,932          34,932         -              32,447        32,447
from PVG and PVR

Other                    16,064         (1,263     )    14,801         (26,118   )    1,209         (24,909   )

Operating cash flow      206,135        (76,862    )    129,273        318,086        (71,945  )    246,141

Changes in operating
assets and               15,888         (3,540     )    12,348         (41,399   )    11,277        (30,122   )
liabilities

Net cash provided by     222,023        (80,402    )    141,621        276,687        (60,668  )    216,019
operating activities

Net cash used in         (248,121  )    72,419          (175,702  )    (636,262  )    306,276       (329,986  )
investing activities

                                                                                                    -

Net cash provided by     112,794        4,623           117,417        344,055        (234,112 )    109,943
financing activities

Net increase
(decrease) in cash       86,696         (3,360     )    83,336         (15,520   )    11,496        (4,024    )
and cash equivalents

Cash and cash
equivalents-beginning    18,338         (18,338    )    -              34,527         (30,503  )    4,024
balance

Cash and cash
equivalents-ending     $ 105,034      $ (21,698    )  $ 83,336       $ 19,007       $ (19,007  )  $ -
balance




(a) Equity method balance sheets represent consolidated balance sheets, minus
100% of PVG's consolidated balance sheets, excluding noncontrolling interests
which represents the portion of PVG's consolidated balance sheet that we do not
own and including other adjustments to eliminate inter-company transactions. We
believe equity method balance sheets provide useful information to allow the
public to more easily discern PVG's effect on our assets, liabilities and
shareholders' equity.

(b) Equity method statements of cash flows represent consolidated statements of
cash flows, minus 100% of PVG's consolidated statements of cash flows, excluding
noncontrolling interests which represents the portion of PVG's consolidated
results of operations that we do not own and including other adjustments to
eliminate inter-company transactions. We believe equity method statements of
cash flows provide useful information to allow the public to more easily discern
PVG's effect on our cash flows.




PENN VIRGINIA CORPORATION

GUIDANCE TABLE - unaudited

(dollars in millions except where noted)

We are providing the following guidance regarding financial and operational
expectations for full-year 2009.

                  Actual

                  First Quarter  Second   Third Quarter  YTD    Full-Year
                                 Quarter

Oil & Gas         2009           2009     2009           2009   2009 Guidance
Segment:

Production:

Natural gas       11.8           11.4     10.6           33.8   42.2   -  43.5
(Bcf) - (a)

Crude oil         171            215      202            588    740    -  760
(MBbls) - (a)

NGLs (MBbls)      147            140      94             381    470    -  490

Equivalent
production        13.7           13.6     12.4           39.7   49.5   -  51.0
(Bcfe)

Equivalent
daily
production        152.3          149.5    134.9          145.3  135.5  -  139.7
(MMcfe per
day)

Expenses:

Cash operating
expenses ($     $ 1.80           1.79     1.82           1.80   1.85   -  1.90
per Mcfe)

Exploration     $ 21.3           17.5     16.1           54.9   63.0   -  66.0

Depreciation,
depletion and   $ 2.92           2.94     3.17           3.04   2.95   -  3.05
amortization
($ per Mcfe)

Impairments     $ 1.2            3.3      92.4           96.8   96.8   -  96.8

Loss on sale    $ -              1.6      -              1.6    1.6    -  2.0
of assets

Capital
expenditures:

Development     $ 76.5           37.3     8.3            122.1  155.0  -  165.0
drilling

Exploratory     $ 1.5            -        0.7            2.2    4.0    -  4.5
drilling

Pipeline,
gathering,      $ 5.1            2.4      0.9            8.4    9.0    -  10.0
facilities

Seismic         $ 0.7            0.4      0.1            1.2    2.0    -  2.2

Lease
acquisition,    $ 1.8            2.8      5.8            10.4   46.0   -  47.0
field projects
and other

Total segment
capital         $ 85.6           42.9     15.8           144.3  216.0  -  228.7
expenditures

Coal and
Natural
Resource
Segment (PVR):

Coal royalty
tons              8.7            8.7      8.4            25.8   33.0   -  34.0
(millions)

Revenues:

Average coal
royalties per   $ 3.50           3.43     3.56           3.50   3.35   -  3.45
ton

Average coal
royalties per
ton, net of     $ 3.36           3.25     3.37           3.33   3.25   -  3.35
coal royalties
expense

Other           $ 7.6            5.1      5.4            18.1   23.0   -  24.0

Expenses:

Cash operating  $ 5.9            6.6      6.0            18.5   23.5   -  24.0
expenses

Depreciation,
depletion and   $ 7.4            8.2      8.0            23.6   31.0   -  32.0
amortization

Capital
expenditures:

Expansion and   $ 1.3            0.6      0.1            2.0    2.0    -  3.0
acquisitions

Other capital   $ -              -        -              -      0.5    -  1.0
expenditures

Total segment
capital         $ 1.3            0.6      0.1            2.0    2.5    -  4.0
expenditures

Natural Gas
Midstream
Segment (PVR):

System
throughput        359            344      324            342    330    -  340
volumes (MMcf
per day) (b)

Expenses:

Cash operating  $ 11.8           11.6     11.6           35.0   48.0   -  50.0
expenses

Depreciation,
depletion and   $ 9.1            9.5      9.8            28.4   38.0   -  39.0
amortization

Capital
expenditures:

Expansion and   $ 11.2           10.3     34.0           55.5   65.0   -  70.0
acquisitions

Maintenance
capital         $ 3.3            1.4      1.4            6.1    7.0    -  9.0
expenditures

Total segment
capital         $ 14.5           11.7     35.4           61.6   72.0   -  79.0
expenditures

Corporate and
Other:

General and
administrative  $ 5.2            5.8      6.4            17.4   23.0   -  24.0
expense - PVA

General and
administrative  $ 0.5            0.6      0.9            2.0    2.4    -  2.8
expense - PVG

Interest
expense:

PVA end of
period debt     $ 591.5          564.3    496.3
outstanding

PVA average
interest rate     4.3%           6.0%     9.8%
(c)

PVR end of
period debt     $ 595.1          597.1    628.1
outstanding

PVR average       3.9%           4.2%     4.2%
interest rate

Income tax        38.8%          39.7%    38.7%          38.9%
rate

Cash
distributions   $ 11.5           11.6     11.5           34.6
received from
PVG and PVR

Other capital   $ 0.6            0.9      0.2            1.7    2.0    -  2.5
expenditures

These estimates are meant to provide guidance only and are subject to change as
PVA's and PVR's operating environments change.

See Notes on subsequent pages.




PENN VIRGINIA CORPORATION

GUIDANCE TABLE - unaudited - (continued)

Notes to Guidance Table:

(a)  The following table shows our current derivative positions in the oil and
     gas segment as of September 30, 2009:

                                            Weighted Average Price

                            Average Volume  Additional  Floor           Ceiling
                            Per Day         Put Option

     Natural Gas Costless   (MMBtu)                     ($ per MMBtu)
     Collars

     Fourth quarter 2009    15,000                      4.25            5.70

     First quarter 2010     35,000                      4.96            7.41

     Second quarter 2010    30,000                      5.33            8.02

     Third quarter 2010     30,000                      5.33            8.02

     Fourth quarter 2010    50,000                      5.65            8.77

     First quarter 2011     50,000                      5.65            8.77

     Second quarter 2011    30,000                      5.67            7.58

     Third quarter 2011     30,000                      5.67            7.58

     Natural Gas Three-way  (MMBtu)                     ($ per MMBtu)
     Collars

     Fourth quarter 2009    30,000          6.83        9.50            13.60

     First quarter 2010     30,000          6.83        9.50            13.60

     Natural Gas Swaps      (MMBtu)                     ($ per MMBtu)

     Fourth quarter 2009    40,000                      4.91

     First quarter 2010     15,000                      6.19

     Second quarter 2010    30,000                      6.17

     Third quarter 2010     30,000                      6.17

     Crude Oil Three-way    (barrels)                   ($ per barrel)
     Collars (1)

     Fourth quarter 2009    500             80.00       110.00          179.00

     Crude Oil Swaps        (barrels)                   ($ per barrel)

     Fourth quarter 2009    500                         59.25

     Crude Oil Costless     (barrels)                   ($ per barrel)
     Collars

     First quarter 2010     500                         60.00           74.75

     Second quarter 2010    500                         60.00           74.75

     Third quarter 2010     500                         60.00           74.75

     Fourth quarter 2010    500                         60.00           74.75




 We estimate that, excluding the derivative positions described above, for every
 $1.00 per MMBtu increase or decrease in the natural gas price, oil and gas
 segment operating income for the remainder of 2009 would increase or decrease
 by approximately $17.4 million. In addition, we estimate that for every $5.00
 per barrel increase or decrease in the crude oil price, oil and gas segment
 operating income for the remainder of 2009 would increase or decrease by
 approximately $1.8 million. This assumes that crude oil prices, natural gas
 prices and inlet volumes remain constant at anticipated levels. These estimated
 changes in gross margin and operating income exclude potential cash receipts or
 payments in settling these derivative positions.

 (1) A three-way collar is a combination of options: a sold call, a purchased
 put and a sold put. The sold call establishes the maximum price that we will
 receive for the contracted commodity volumes. The purchased put establishes the
 minimum price that we will receive for the contracted volumes unless the market
 price for the commodity falls below the sold put strike price, at which point
 the minimum price equals the reference price (i.e., NYMEX) plus the excess of
 the purchased put strike price over the sold put strike price.




PENN VIRGINIA CORPORATION

GUIDANCE TABLE - unaudited - (continued)

     The costless collar natural gas prices per MMBtu per quarter include the
(b)  effects of basis differentials, if any. The following table shows current
     derivative positions for natural gas production in PVR's natural gas
     midstream segment as of September 30, 2009:

                                                     Weighted Average Price

                           Average
                           Volume     Swap           Additional  Put    Call
                                      Price          Put Option
                           Per Day

     Crude Oil Three-Way   (barrels)                             ($ per barrel)
     Collar

     Fourth quarter 2009   1,000                     70.00       90.00  119.25

     Frac Spread Collar    (MMBtu)                               ($ per MMBtu)
     (1)

     Fourth quarter 2009   6,000                                 9.09   13.94

     Crude Oil Collar      (barrels)                             ($ per barrel)

     First quarter 2010
     through fourth        750                                   70.00  81.25
     quarter 2010

     Crude Oil Collar      (barrels)                             ($ per barrel)

     First quarter 2010
     through fourth        1,000                                 68.00  80.00
     quarter 2010

     Natural Gas Purchase  (MMBtu)    ($ per MMbtu)
     Swap

     First quarter 2010
     through fourth        5,000      5.815
     quarter 2010




     We estimate that, excluding the derivative positions described above, for
     every $1.00 per MMBtu increase or decrease in the natural gas price,
     natural gas midstream gross margin and operating income for the remainder
     of 2009 would decrease or increase by approximately $2.5 million. In
     addition, we estimate that for every $5.00 per barrel increase or decrease
     in the crude oil price, natural gas midstream gross margin and operating
     income for the remainder of 2009 would increase or decrease by
     approximately $2.4 million. This assumes that crude oil prices, natural gas
     prices and inlet volumes remain constant at anticipated levels. These
     estimated changes in gross margin and operating income exclude potential
     cash receipts or payments in settling these derivative positions.

     (1) PVR's frac spread is the spread between the purchase price for the
     natural gas PVR purchases from producers and the sale price for the NGLs
     that PVR sells after processing. PVR hedges against the variability in its
     frac spread by entering into swap derivative contracts to sell NGLs forward
     at a predetermined swap price and to purchase an equivalent volume of
     natural gas forward on an MMBtu basis.

     Third quarter 2009 average interest rate excludes effect of $2.4 million
(c)  reclassification from accumulated other comprehensive income related to
     interest rate swaps.




    Source: Penn Virginia Corporation