Operational Update

Petroneft Resources PLC
17 May 2007



                            PetroNeft Resources plc

                               Operational Update



PetroNeft Resources plc ('PetroNeft' or 'the Company'), owner and operator of
Licence 61, Tomsk Oblast, Russian Federation is pleased to provide this update
on the progress on its 2006/07 three well drilling programme and related field
development planning.


Lineynoye and Tungolskoye Drilling Programme

The Lineynoye and Tungolskoye Oil Fields were originally found by a Soviet
Exploration Company in the early 1970s. The current appraisal drilling
programme, which comprises two wells, is designed to confirm the reservoir data
of the 1970s discovery wells and provide further input into a Final Development
Feasibility Study, expected to be completed in the 3rd/4th quarter of 2007. The
results of the high value exploration well, Lineynoye No. 7, will also be
incorporated into the Final Development Feasibility Study.

Tungolskoye No. 4 Well

The Tungolskoye No. 4 well on Licence 61 was spudded on May 16, 2007. The
principal target horizons for this well are Upper Jurassic sandstone reservoirs
starting at a depth of 2,490 metres. The total planned depth for the well is
approximately 3,100 metres.  It is anticipated that the well will be drilled,
logged and tested within approximately 70 days of commencement.

Lineynoye No. 6 Well

The Lineynoye No. 6 well on Licence 61 was spudded on March 4, 2007. Results of
the initial petrophysical analysis were released on April 24, 2007, where oil
was confirmed in the Upper Jurassic J1 sandstone reservoir interval in two
stratigraphic units. Flow testing of this well is currently in progress and
results will be published as soon as they are available (potentially within the
next couple of weeks).

Lineynoye West Prospect. Lineynoye No. 7 Well

West Lineynoye, a high impact prospect, is estimated by Ryder Scott to contain
Possible Reserves of approximately 67 million barrels of oil. A third rig which
was mobilised to the site for this well is currently being assembled and is now
expected to commence drilling in June. The principal target horizons for this
well are again the Upper Jurassic sandstone reservoirs starting at a depth of
2,375 metres. The total planned depth for the well is approximately 2,750 metres
and it is anticipated that the well will also be drilled, logged and tested
within approximately 70 days of commencement.

Development Planning

Pipeline Design, Survey and Approvals Contract

On May 7, 2007, PetroNeft entered into a contract with 'ETC Service' LLC for the
design, survey and approval of an export pipeline from the Lineynoye and
Tungolskoye fields to the Transneft pipeline at the Raskino pumping station. The
contract also includes the design and approvals for the custody transfer point
at the Transneft regional pipeline tie-in point. The award of this contract is a
critical step in the ultimate development and commercialisation process in
respect of current and potential future discoveries on Licence 61. PetroNeft is
committed to an early production date to provide positive cashflow and add value
to shareholders.


Dennis Francis, Chief Executive Officer of PetroNeft Resources plc commented:

'We are pleased to have spudded the second well in our three well drilling
program and look forward to announcing the results of the Lineynoye No. 6 flow
testing program in the near future. In parallel with the ongoing drilling and
technical work, the signing of the Pipeline Design, Survey and Approvals
Contract maintains the Lineynoye and Tungolskoye Field Development Project on
schedule for first production starting in 2009.'



For further information, contact:

Dennis Francis, CEO, PetroNeft Resources plc                     
[phone]

Desmond Burke, Director Investor Relations, PetroNeft Resources plc 
[phone]

John Frain/Brian Garrahy, Davy
[phone]

Nick Elwes/Paddy Blewer, College Hill
[phone]


The information contained in this announcement has been reviewed and verified by
Mr. Dennis Francis, Director and Chief Executive Officer of PetroNeft, for the
purposes of the Guidance Note for Mining, Oil and Gas Companies issued by the
London Stock Exchange in March 2006. Mr. Francis holds a B.S. Degree in
Geophysical Engineering and a M.S. Degree in Geology from the Colorado School of
Mines. He has also graduated from the Harvard University Program for Management
Development. He is a member of the American Association of Petroleum Geologists
and the Society of Exploration Geophysicists. He has over 34 years experience
in oil and gas exploration and development.


Forward Looking Statements

This announcement contains forward-looking statements. These statements relate
to the Company's future prospects, developments and business strategies.
Forward-looking statements are identified by their use of terms and phrases such
as 'believe', 'could', 'envisage', 'potential' 'estimate', 'expect', 'may', '
will' or the negative of those, variations or comparable expressions, including
references to assumptions.

The forward-looking statements in this announcement are based on current
expectations and are subject to risks and uncertainties that could cause actual
results to differ materially from those expressed or implied by those
statements. These forward-looking statements speak only as at the date of this
announcement.


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