Strategy

Today, Parallel’s primary focus is the acquisition and enhancement of producing oil and gas assets. To a lesser extent, the Company will continue to drill lower risk exploratory oil and gas prospects associated with 3-D seismic. In December 2002, Parallel closed its $46 million Fullerton acquisition of long-life, shallow oil properties located in the Permian Basin of West Texas. Since September 28, 2004, the Company has completed three unrelated acquisitions of Permian Basin properties for a total investment of approximately $34.5 million, and the Company announced on December 1, 2004, that it entered into Purchase and Sale Agreements to acquire additional interests in some of these West Texas properties for a total investment of $5.66 million. Parallel expects these properties to have a lot of high quality, inexpensive, upside potential with enhancement opportunities that have a higher probability of success than drilling exploratory wells.