Drilling Report

Pan Andean Resources PLC
17 November 2004


                    Pan Andean Drilling Update from Bolivia


The El Dorado X-1004 exploratory well, located in Santa Cruz, Bolivia, has been
completed.

We encountered gas shows at target depths with good porosity and permeability in
the key target zone.

Electric logs showing the presence of gas, good porosity and permeability
strengthen our belief that the total reserves are over 400 bcf of gas and 6
million barrels of associated condensate.

Production testing was inconclusive, pending re-entry closer to the development
date.

The well confirms that the reservoir extends at the west flank of El Dorado
anticline.


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