Po Valley Gas Projects - Quarterly Report to March 2006

Adelaide, Apr 28, 2006 (ABN Newswire) - Po Valley Energy (ASX: PVE) consolidated its position during the March Quarter, completing key geological work on the successful development fields, Sillaro and Vitalba, confirming upgrades in reserves and moving key projects forward towards first gas production in 2007.

Sillaro

- 26% increase in Total reserves

- Good conversion of Probable reserves to Proven - 10.4bcf

- High quality dry gas quality confirmed

- Geological review complete

- Discussions on Pipeline Grid connection underway

- Preparation of Production Concession well advanced

Vitalba

- 28% increase in Proven reserves

- Positive flow test on levels San 1 and San 2 of 2.8m cubic feet per day

- High quality dry gas quality confirmed

Santa Maddalena

- Production concession application complete and ready for submission

Market Conditions

- Italian market gas prices continue to remain strong

- Cash at Bank 31 March 2006 - AUD5.38m

Sillaro - east of Bologna
The major priority for Po Valley is to progress Sillaro to commercial gas sales. Following successful tests late in December, 2005, the Sillaro geological model has been updated and reserves upgraded. As part of this work, well location for a second Pliocene well and a possible third Miocene well have been identified and well design has been progressed.

Tests of gas samples confirm that the Sillaro gas is of very high quality. Work has begun on the production concession application to convert the licence from an exploration licence to a production licence. The final stage of this work including surface plant engineering and pipeline grid connection is underway, as is the environmental approval application.

Vitalba - east of Milan
Vitalba tested positive for gas flows in the San A1 and San A2 levels in January 2006. Well test reports have been conducted on the results. Tests of the gas samples also confirmed dry high quality gas. Work has commenced on the production concession application.

Santa Maddalena - north of Bologna
Joint Venture partner and operator, Edison Gas has completed the production concession application and the environmental approval documentation. The company expects Edison Gas to lodge this approval documentation shortly.

New Development Projects - Bezzecca 1 (aka Pandino) - southeast of Milan
Design of the drilling program for Bezzecca 1 is underway, with the well location identified and orders placed for long lead equipment including casing and tubing.

Italian Gas Market
Prices in the Italian gas market have continued to remain strong in the March Quarter, accelerated by the tightening market conditions and rising oil prices.

Corporate
Cash at bank at the end of the December quarter was AUD5.38m

Source:
Kevin Skinner
Senior Consultant
FIELD PUBLIC RELATIONS

231 South Road
MILE END SA 5031
Tel: (08) 8234 9555
Fax: (08) 8234 9566
Mob: 0414 822 631
kevin@fieldpr.com.au

About PO VALLEY ENERGY LIMITED

Po Valley Energy Limited (PVE) is engaged in the exploration for gas in the Po Valley region in Italy, and appraisal and development of gas properties. During the year ended December 31, 2006, the Company prepared and submitted production concession applications for Sillaro, Castello (aka Vitalba) and Sant Alberto (aka Santa Maddalena) fields. During 2006, eight new license area applications were submitted, of which PVE was awarded with the rights to proceed forward for five gas and oil exploration licenses applications in Italy. The additional licenses cover a total area of 1,610 square kilometers and are all contained within the petroleum provinces in northern Italy where the Company has focused its development options. The five license applications are Ossola and Opera located near Milan and La Prospera, Podere Gallina and La Risorta located near Bologna. The license areas contain eight new gas prospects and two new oil exploration targets.