Hi Sharky ,

Without money for the exploration PDP will go under. They need $30 to $40 million injection to their working capital (which is negative at this time). I was hoping you sold your shares in February.

This a Scotia Capital take on PDP

PDP Recent Update as of 7SEP10

Petrolifera announced plans to undertake a strategic review that could include
potential asset divestments, joint ventures, and/or corporate sale/combination
that may move rather quickly considering the company’s drilling/debt
obligations in 2010/11 and its financial position.

In our view, the decision to look at a variety of alternatives to realize
further value from its asset base is sound given the persistently low multiple
the market has ascribed to Petrolifera. That said, we would look upon the sale
of a material portion of its interest in Peru in isolation as a negative, given
it represents the highest impact potential within its exploration portfolio.

We would also note, at this stage, the difficulty in establishing value for the
exploration upside with no reserves in Peru and limited bookings in Colombia.

We maintain our 2-Sector Perform rating on Petrolifera and one-year target
price of $0.90 per share based on our risked NAVPS of $0.94.

Beyond any outcome of its strategic review, we see the next major catalysts for
Petrolifera being exploration results from the San Angel 1x well set to spud in
Q4 and Brillante SE 1x long-term test results that could yield to new reserve
adds in February.

Valuation: Based on our risked NAV ($0.94/share) that also equates to 6.8x
2011E debt-adjusted CF and 1.08x our 2P NAV.

Gavin Wylie (Scotia Capital Inc. - Canada)
gavin_wylie@scotiacapital.com / (403) 213-7333