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Imperial Energy Corp (IEC)

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Monday 21 January, 2008

Imperial Energy Corp

Operational Update

Imperial Energy Corporation PLC
21 January 2008

                        IMPERIAL ENERGY CORPORATION PLC

                       ("Imperial Energy" or "Imperial")


                               OPERATIONAL UPDATE


Imperial, the FTSE 250 energy company, today announces an update on its
operations in Tomsk Region, Western Siberia.


Highlights


Production

•         2007 target production of 10,000 bopd exceeded

•         New production targets of 60,000 bopd by end 2010 and 80,000 bopd by
          end 2011

•         Oil sales in line with budget


Development and Exploration

•         65 new production wells planned for 2008

•         South Maiskoye structure testing successful

•         New pipeline East of Ob proceeding

•         Oil now flowing directly into Transneft at Lugenetskoye tie-in


Corporate

•         Strategic Options, including IPO being considered for Imperial's oil
          service company



OIL SALES

Oil sales have commenced the year in line with the initial budget following the
target production rate of 10,000 bopd for end 2007 being exceeded before the end
of December. In the short term Imperial continues to target 25,000 bopd
production by year end 2008 and 35,000 bopd by year end 2009.  In addition,
Imperial is now targeting production of 60,000 bopd by year end 2010 increasing
to 80,000 bopd by the end of 2011 from currently identified structures.


INFRASTRUCTURE

Imperial's wholly owned infrastructure is considered a very valuable asset and
the gateway to unlocking Imperial's significant potential in the region.  By the
end of 2008, Imperial will have spent over US$275 million in constructing three
major pipelines and major infrastructure works which will be the backbone of
Imperial's future prosperity in the Tomsk Region.



Pipelines West of the Ob River, Tomsk Region, Russian Federation

Imperial's tie-in with Transneft at Lugenetskoye has now been completed and
commissioned. Accordingly oil is flowing direct to Transneft from the Maiskoye
field.  Whilst the Zavyalovo tie-in is in the process of commissioning this does
not impact production or sales as all of the Snezhnoye field production is
transportable as before by all weather road.  First exports of oil are taking
place in January with Vitol as off-taker.


New Pipelines East of the Ob River, Tomsk Region, Russian Federation

Construction of Imperial's new 152 km pipeline East of the Ob River, the first
pipeline for the Tomsk Region serving this very prospective area, connecting
Imperial's Block 80 to the Zavyalovo tie-in, is proceeding in line with
expectations.     First oil from Block 80 through that pipeline is presently
targeted for September 2008.



PRODUCTION DRILLING

The programme for the current winter season has commenced with drilling and
movement of equipment proceeding in line with expectations. The aggressive
programme for 2008 consists of 65 production and appraisal wells which will be
drilled by Imperial's own rigs as well as third party rigs which have already
been contracted. In line with Imperial's practice and due to the significant
amount of work being carried out over a wide area, specific information as to
drilling programmes will be released at appropriate points in time.   Imperial
is planning this year to drill production wells on Snezhnoye, Maiskoye,
Festivalnoye and Kiev Eganskoye fields with other structures under
consideration.


Imperial has now opened up pilot production from its Festivalnoye field which is
on the Maiskoye-Lugenetskoye pipeline. Whilst at the present time it is in test
with very limited volume, new pilot production / appraisal wells are planned for
this year on that field, complimenting the three useable wells previously
drilled by Imperial. Each production / appraisal well will target a depth of
3,200 meters and will be drilled by one of Imperial's new rigs.


An extensive full year frac programme is also under way.  In the first three
months of 2008 there are 14 frac jobs planned. Imperial's own frac company,
Imperial Frac Services, is fully engaged in this work as well as third party
contractors.


EXPLORATION

As well as the extensive production work on currently identified fields,
Imperial continues to focus on its exploration and appraisal programme and is
committed to discovering major new oil reserves for the Tomsk Region in 2008.


South Maiskoye

Imperial has successfully tested its new exploration well, South Maiskaya 3.
Before the end of 2007, the interval between 2979-3004 metres in the Tyumen
section was perforated and a rate without stimulation of approximately 85 bopd
was achieved with free flow to surface.   This test is similar in result to the
successful test performed in 2007 on the same section at the nearby Maiskoye
field where currently vertical wells are currently producing on average in
excess of 400 bopd on a steady state basis.


Testing of the very prospective Vasyugan section will take place within the
first half of 2008. This section likewise shows the same properties as in the
Maiskoye field where horizontal wells addressing the Vasyugan section are
producing very successfully.


An application to register the South Maiskoye structure with the Russian
authorities will be made before the end of February. There are currently neither
Russian Registered Reserves nor SPE reserves for South Maiskaya.


2008 Programme

At least three exploration wells will be drilled in the Tomsk Region in the
first half of 2008.   Two are planned for the Kiev-Eganskoye area in Block 80
and one in an area between the Maiskoye field and South Maiskaya structure.


Testing Programme

The testing programme for wells originally drilled in 2007, which is necessary
to be performed prior to application for registration of the reserves with the
Russian authorities include the following structures: Buranovskoye, Central
Festivalnoye, Chagvinskoye, South Festivalnoye, North Chertalinskoye as well as
the now successfully tested South Maiskaya. There are currently no Russian
registered reserves on any of these structures, and no 2P SPE reserves in
respect of Buranovskoye and Chagvinskoye fields.


Kazakhstan, North Torgai Block

This well is still being drilled. It is anticipated that the results of this
well will now be announced by the end of March 2008.


RUS IMPERIAL GROUP ("RIG")

Imperial is currently reviewing its strategic options in relation to it's
growing oil services arm which may include spinning off this division by way of
IPO on the Alternative Investment Market of the London Stock Exchange.  Imperial
has also received a number of approaches from reputable international parties to
acquire all or part of RIG and these remain under review. ABN AMRO and Unicredit
have been appointed to advise Imperial. It is anticipated that a further
announcement on this subject will be made before the end of March 2008.
Imperial operates RIG as a separate unit with its own offices and administration
in Tomsk and a service centre in Strezhevoye.


The first of the new rigs of Rus Imperial Group is currently being rigged-up on
the Snezhnoye field.   By the spring of 2008, RIG will be operating its three
new heavy duty rigs and one new work-over rig which is due for delivery in
February.


In the second part of 2008 Imperial is planning to order a further three new
heavy duty rigs together with a further two new work-over rigs, all of which are
projected to be separately financed.


                                                                 21 January 2008

Enquiries:

Imperial Energy Corporation PLC
Peter Levine                            +44(0)207 758 9658
John Hamilton                           +44(0)207 758 9658


Pelham PR
James Henderson                         +44(0) 207 743 6673/ +44(0) 777 4444 163
Gavin Davis                             +44(0) 207 743 6677/ +44(0) 791 0104 660
Evgeniy Chuikov                         +44(0) 203 008 5506/ +44(0) 789 4608 606



NOTES TO EDITORS

(1)        SPE reserves are reserves calculated in accordance with the rules set
out by the internationally recognised Society of Petroleum Engineers.

(2)        SPE 2P reserves are generally recognized as incorporating Russian
Registered Reserves classifications C1, C2 and some C3.

(3)        Imperial Energy is a FTSE 250 independent oil exploration and
production company listed on the Main Market of the London Stock Exchange with
operations in the Russian Federation and Kazakhstan.




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