PDC Gas - Petroleum Development Corporation: Bridgeport, West Virginia

Accelerating production and reserve growth in the Rocky Mountain region continues to drive success at our Company. In 2007, production grew to 23.5 Bcfe from 14.1 Bcfe, a 67% increase. Reserves grew to 559 Bcfe from 265 Bcfe, an 110% increase. A total of 337 gross wells were drilled in 2007, compared to 230 gross wells in 2006. And, we successfully recompleted and/or refractured a total of 181 wells compared to 43 in 2006.

The Rocky Mountain region also accounted for 83% of oil and gas sales in 2007, as well as 81% of total proved reserves. Increased investment in these properties, combined with decreasing G&A unit costs, further helped increase production and deliver positive results.

The Rocky Mountain natural gas markets experienced significant pricing pressure throughout much of 2007. Pricing pressure resulted primarily from local oversupply in the region and insufficient pipeline capacity to move natural gas to other markets. In December 2007, however, Kinder Morgan Energy Partners completed the first phase of the Rocky Mountain Express pipeline. The completion of the pipeline has significantly increased take-away capacity and improved Rocky Mountain natural gas prices. When fully completed in 2009, this pipeline is expected to transport 1.8 Bcfe per day from the Rocky Mountain area to the east coast. The general details of each area within the region are further outlined below:

Grand Valley Field, Piceance Basin, Garfield County, Colorado.

Following the lease sale in 2006, PDC initiated an aggressive program to further unlock value in the Company’s core assets. We quickly determined that the focus of our 2007 operations would concentrate on integrating and exploiting the acquisitions made with the proceeds from the 2006 lease sale and continue to exploit our lease position throughout the Rocky Mountain Region, including Grand Valley.

While the drop in Rocky Mountain natural gas prices forced us to curtail production in our Piceance operations in October 2007, prices have since strengthened and production was returned to normal in November 2007. As a result, our Grand Valley properties are continuing to contribute to our production success. In 2007, we drilled 53 gross, 42 net wells, increased production to approximately 8.2 Bcfe and grew reserves.

In addition, improved access to the mesa in the Grand Valley in 2008 will also allow us to drill year round in this area, leading to increased productivity and production in the Grand Valley Field. We used new slick water completion techniques, combined with new technologies, to increase daily production rates and estimated ultimate reserves (EUR) to 1.5 Bcfe per well.

Wattenberg Field, Denver Basin, Weld and Adams Counties, Colorado.

In 2007, PDC’s low-risk, high-quality prospects in the Wattenberg Field delivered unprecedented results. We exceeded our initial drilling expectations forecast in the beginning of 2007 and drilled 158 gross wells compared to 123 wells in 2006. We increased production to 11 Bcfe net to our interests compared to 6.7 Bcfe in 2006. We also exited the year with 1,242 gross operated wells, compared to 916 operated wells in 2006.

Success in the Wattenberg Field can be partially attributed to our ability to further leverage technology and unlock existing potential in the Codell and Niobrara programs. Improved fracture technology has made the Codell and Niobrara profitable opportunities for the Company.

The Wattenberg Field is the Company’s second largest source of untapped potential. With more than 900 potential drilling locations and plans to drill 115 wells in 2008, the Wattenberg Field is currently our largest producing area.

NECO area, DJ Basin, Yuma County Colorado and Cheyenne County, Kansas.

In 2007, PDC continued its multi-phase development program in Northeast Colorado (NECO). After having acquired a majority interest in 260 wells in 2003, and then initiating an infill development program combined with a seismic shoot across the undeveloped acres, PDC drilled 123 gross wells and produced approximately 3.6 Bcfe in 2007.

New drilling operations range from exploratory wells to test undrilled, seismically defined structural features at the Niobrara horizon to develop wells targeting known reserves in existing identified features.

PDC currently owns an interest in 586 gross wells on approximately 104,500 acres with approximately 55,300 net undeveloped acres as of year end December 31, 2007. Wells drilled in this area range from approximately 1,500 to 3,000 feet in depth and target gas reserves in the shallow Niobrara reservoir.