Interim Results

Pan Andean Resources PLC
19 December 2007

                            Pan Andean Resources Plc

                         'Pan Andean, or 'the Company'

            Interim Results for the period ended September 30th 2007


                                   Highlights

  • Farm out negotiations near to completion on Blocks 114 and 131 in Peru.

  • Farm out negotiations ongoing on Block 141 in Peru.

  • Success in Colombia with the award of the Antorcha oil block.

  • Successful drilling and tie in on Block High Island 52 in the Gulf of
    Mexico.

  • Turnover increased by 7.8% to £882,000

  • Profit before tax increased by 3% to £451,000


Recent months have been a period of intense activity in both the US and South
America.  Our strategy of using our US assets to fund our exploration in South
America is working.  Our success in obtaining three quality exploration blocks
in Peru, thereby becoming one of the largest land holders, has paid off.  A
number of international oil companies have approached us to joint venture our
ground.

Whilst we continue to conduct activities, particularly on Block 114 in Peru,
taking a partner will expedite exploration operations, driving towards drilling
in 2009 and will reduce financial expenditure.  Drilling in the Peruvian jungle
has high potential but has high costs.

We are at a very advanced stage in agreeing a farm in with a major international
company on Blocks 114 and 131 in the Ucayali Jungle area of Peru.  This will see
our partner become operator in return for a significant carried interest for Pan
Andean. An announcement is expected in the near future.

Block 141 in the Lake Titicaca area of Peru is a large early stage oil
exploration play.  A major oil company has been in discussion with Pan Andean to
joint venture the property.  A deal is likely in the coming months.

Our work in Colombia finally paid off when we were awarded the Antorcha Block in
the oil prolific Middle Magdalena Basin.  Preliminary studies suggest
significant quantities of 10 to 20 API oil at depths of less than 2000 feet.
Initial work is ongoing.  Here again there is joint venture interest.

In Bolivia, production continues at Monteagudo where Pan Andean, with our
partners Repsol and Petrobras, continues dialogue with the government on a
regime which will allow production to continue as well as encourage Pan Andean
to drill the deep exploration play.

The growing demand for Bolivian gas in the Southern cone of South America is
improving the prospect for the development of our El Dorado (10% Pan Andean, 90%
BP) gas discovery.

We fund our South American operations from our US cash flows where we have
significantly reduced operational risk in the Gulf of Mexico by passing
abandonment liabilities on Block High Island 52 to a new company and by
appointing Hunt Oil as operator of High Island 30.


High Island 52 - Gulf of Mexico

In August 2007 Phoenix Exploration Inc. successfully drilled an exploration well
to a target depth of 8,700 feet and encountered over 160 feet net pay of
hydrocarbon column in three separate sections.  Production commenced in November
at 5 million cubic feet of gas per day (mcfd), is currently producing at 6 mcfd
and is expected to increase to 10 mcfd over the next few months. Phoenix has a
team reviewing all available data, seismic etc. with a view to drilling a deep
well in 2008.  They have now earned into the block and have taken over the
platform and related abandonment liabilities; estimated at US$6 million.  Pan
Andean holds a 2.15% revenue royalty on all wells to be drilled by Phoenix.

In the Northeast quarter of the block, Woodside are producing over 35 mcfd from
3 wells.  Pan Andean holds a 1.32% revenue royalty which produces significant
cash flow each month.


High Island 30 L - Gulf of Mexico

The long awaited restart of production on HI 30 L (62.7% Pan Andean) has again
been delayed due to leaks in the Tammany owned pipeline which transports oil
from HI 24 to shore.  Production started on 11th November 2007 but had to stop
almost immediately as leaks were discovered on the four and a half mile pipeline
belonging to Tammany Oil.  Production is now expected to restart in the first
quarter of 2008 when repair work on the pipeline is completed. We expect
production to start at over 300 barrels of oil per day.  Since March 2007 the
platform has been completely refurbished and gas lift installed.  We are in the
process of abandoning a number of the old obsolete wells on the block.


High Island A68 - Gulf of Mexico

The platform and wells on the HI68 lease which expired in 2005 were abandoned in
June 2007.


Onshore - Texas

We continue to work on our onshore assets where our main focus is finding a
partner to drill Danbury Dome.  The Vrazel and North Bob West leases continue to
provide a steady monthly income.


Financials

Higher gas prices have driven a 7.8% increase in turnover in the period, from
£818,000 to £882,000 in the same period last year. Pan Andean remains one of the
very few profitable oil & gas producing companies listed on AIM, with a rise in
PBT of 3% to £451,000 from £437,000.

Pan Andean remains financially robust through its strong cash flow.


Future

Pan Andean has a portfolio of exploration opportunities, the quality of which is
seen in the parade of potential partners.  We will select partners with the
technical and financial muscle to expedite state of the art exploration on our
three Peruvian blocks and potentially on our Colombian block.

The frustrating delays in restarting production on High Island 30 masks our
success on High Island 52 and the adept management of our US assets to minimise
our environmental expense and to upgrade our facilities.

We are well placed to take on additional exploration opportunities.

John J Teeling
Chairman
19 December 2007


For further information:

Pan Andean Resources Plc
David Horgan, Managing Director                       + 353 87 292 3500
John Teeling, Chairman                                + 353 1833 2833

Blue Oar Securities Plc
Simon Moynagh / John Wakefield                        + 44 (0)117 933 0020

College Hill
Paddy Blewer / Nick Elwes                             + 44 (0)207 457 2020


www.panandeanresources.com


Financial Information (unaudited)
                                                                                   Six Months ended
                                                                            30 Sep 07            30 Sep 06
                                                                                £'000                £'000
Group Profit and Loss
Turnover                                                                          882                  818
Operating Costs                                                                 (416)                (385)

Operating Profit                                                                  466                  433
Interest Receivable                                                                26                   46
Interest Payable                                                                 (41)                 (42)

Profit before Taxation                                                            451                  437
Taxation                                                                        (135)                (131)

Profit for the period                                                             316                  306

Profit per share                                                                0.26p                0.26p



                                                                            30 Sep 07             30 Sep 06
                                                                                £'000                 £'000
Group Balance Sheet
Fixed Assets                                                                   15,784                13,930

Current Assets                                                                  3,195                 5,554
Current Liabilities                                                           (2,021)               (1,666)

Current Assets less Current Liabilities                                         1,174                 3,888
Creditors (amounts falling due after one year)                                (1,730)               (2,243)

Total Assets less Liabilities                                                  15,228                15,575

Share Capital and Reserves                                                     15,228                15,575



                                                                            30 Sep 07             30 Sep 06


                                                                                £'000                 £'000
Group Cash Flow
Operating Profit                                                                  466                   434
Movements in Working Capital                                                    (501)                  (80)
Exchange Movements                                                              (423)                 (211)
Net Cash (Outflow)/Inflow from
Operating Activities                                                            (458)                   143

Returns on Investments and Servicing of Finance                                  (15)                     4
Capital Expenditure                                                           (1,145)                 (356)

Decrease in Cash                                                              (1,618)                 (209)



Notes

1. The figures for the six months to 30th September 2007 and 30th September
2006 are unaudited. The financial information set out above and does not
constitute full statutory accounts within the meaning of section 240 of the
Companies Act 1985.

2. The interim unaudited results have been prepared on a going concern
basis and in accordance with International Financial Reporting Standards.

3. Copies of this announcement will be sent to shareholders and will be
available for inspection at the Company's registered office at 20-22 Bedford
Row, London, WC1R 4JS.




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