22.10.08 - 13:52 Uhr
  22nd October 2008

Highlights of Chairmans Comments at the

Pan Andean Resources AGM

London, Wednesday 22nd October 2008

In these very turbulent times, it is a pleasure to present a company
showing profits, cash, cash flow and production.

* Pan Andean is one of the few AIM listed oil and gas producers
/ explorers with production, profits and cash

* Our latest drilling, the deep wildcat Danbury Dome well,
onshore Texas, is making good progress to reaching the target depth of
13,500 feet. The target is gas in a substantial structure

* The highlights of the past year were undoubtedly the
successful farm-outs of our Peruvian blocks and the acquisition of the
Antorcha block in Colombia

* CEPSA of Spain and Reliance Industries of India, two world
class multinationals, are now our partners on blocks 114 / 131 and 141
respectively in Peru. Pan Andean has a 30 per cent interest and a full
carry through the first well in each case and a 50 per cent carry in the
second. In addition, Pan Andean received $3 million in back costs.

* In recent weeks we have been awarded Block 161, in the
Ucayali basin in Peru

* The Antorcha block in Colombia, 100 per cent Pan Andean, is
located adjacent to proven fields and infrastructure and is thought to
be highly prospective. The recently completed 60km seismic programme has
identified drillable structures of significant size

* The targets are shallow, and subject to rig availability,
drilling could begin in early 2009

* There is interest from outside parties in participating in

* Bolivia remains a no go area for investment but the potential
of our El Dorado gas discovery is recognised and development proposals
are being examined

* The US remains the cash engine of Pan Andean, generating
revenue mainly from offshore oil production and from royalties both
onshore and offshore

* Hurricane Ike caused limited damage to our platforms but
onshore processing facilities received water damage. We estimate that we
will lose approximately two months revenue before production is back up
and running

* Falling oil prices and a frozen stock market are already
generating opportunities. Our profits, cash and projects are attractive
to many junior oil ventures. We see a flow of prospects and projects. We
can afford to be selective, looking to create the most value for our

* All resolutions were passed at the meeting


Pan Andean

David Horgan, Managing Director

+ 353 87 292 3500

John Teeling, Chairman

+ 353 1 833 2833

College Hill

Paddy Blewer

+44 (0)20 7457 2020

Nick Elwes

Blue Oar Securities Plc

John Wakefield

+44 (0)1179 330020

Simon Moynagh

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