PXX Pearl Exploration And Production LT Com Npv

Pearl Exploration and Production Ltd. ("Pearl" or the "Company") (TSX
VENTURE:PXX)(FIRST NORTH:PXXS) is pleased to provide the following update on its
operations activities in the third quarter of 2007.


Gross production for Pearl during the last week of August averaged approximately
10,500 barrels of oil equivalent per day ("boepd"). Production from the previous
quarter ending June 30, 2007 averaged approximately 7,910 boepd.


The Company therefore continues to forecast gross production exit rates for 2007
in the range of 14,000 to 15,000 boepd.


Operationally, the Company has continued to execute a 2007 work program focused
on investments in core conventional heavy oil production development projects
such as Onion Lake (87.5% Working Interest) and Mooney (98.4% Working Interest)
in order to both appraise and develop reserves. The expectation is that
significant gains will be realized in 2007 for production, near term cash flow
and net present value additions.


Keith Hill, President and CEO of Pearl, commented, "We are pleased with progress
to date on our core projects. Despite a difficult operating environment thus far
this year for our industry from the standpoint of weather and service costs, we
are on track to meet our aggressive production and cash flow targets for year
end 2007. These investments will position Pearl with a foundation that will
allow us to take advantage of additional growth opportunities that we see
emerging both this year and in 2008."


Operations activities in the third quarter of 2007 were focused in the following
key areas.


Onion Lake Heavy Oil Project - Saskatchewan

The Company resumed its multi-well development drilling program of this heavy
oil trend in July 2007 with 15 wells being drilled during the third quarter and
of these, 12 have been placed on initial production. This brings the total
number of wells drilled in 2007 to 40 wells, with 35 wells having been placed on
production. At the end of August the Company's gross production has increased
approximately 300 boepd, bringing the average production up to over 1,500 boepd.
Based on the positive results and current progress of the drilling campaign thus
far, the Company is expecting to drill approximately 110 wells in the 2007
subject to regulatory approvals and weather conditions. A well "down-spacing"
application has now received regulatory approval and will allow a total of 85
locations to be drilled over the second half of 2007. The Company is also
beginning construction of centralized facilities for sand and oil handling in
September 2007 which will lead to operating cost reductions. A 3-D seismic
survey will also be permitted to further evaluate the Company's southern acreage
and prioritize 2007 and 2008 development drilling locations. A thermal recovery
pilot involving two wells will become operational in late 2007, with the
procurement and construction of pilot facilities now underway.


Mooney Heavy Oil Project - Alberta

Development drilling continued at the Mooney Bluesky "A" oil pool throughout the
summer period. As of the end of September 2007, a total of 20 new horizontal oil
wells will have been drilled. Eleven of these new wells are currently on
production and by mid September the remaining nine horizontal wells will be
brought on production. At that time there will be a total of 32 horizontal
producing wells in the field. With the Company's recently announced acquisition
of an additional 24% Working Interest, the Company's gross production has
increased to approximately 2,300 boepd for the month of August. In September
this production will increase another 900 boepd, bringing the September average
production up to approximately 3,200 boepd. Development projects including water
or polymer injection continue to be evaluated and advanced.


Other Canadian Properties - Alberta, Saskatchewan

Drilling and production enhancement projects continued on the Company's other
heavy oil producing properties. Near term production additions will be realized
from a successful summer recompletions program carried out in the Celtic area,
and focused area drilling primarily in the Ear Lake / Salt Lake region. At Ear
Lake, 4 development wells were drilled and completed in the third quarter. Early
production testing is now underway and results suggest that a productive
geological trend has been identified. An additional 6 "follow up" drilling
locations are being licensed for drilling during September. At the adjacent
Reward area, 2 development drilling locations have been licensed to offset a
producing discovery well. In the Salt Lake area, an exploration location has
been licensed for September drilling, and 3 development horizontal locations are
proposed for the Lloydminster sand in the Salt Lake pool. The Company drilled an
additional 5 wells in the Lloydminster area and is currently drilling a sixth
well. One of these wells, drilled in the Standard Hill area, has discovered a
new Waseca pool.


The Company also completed the drilling of a horizontal well in the Druid field
and placed it on production in order to test the reserves potential of this
field which has the potential for a water cycling project in the first half of
2008. The Company also purchased an additional 4 Sections of 100% working
interest land at Druid to offset the existing land base. Two additional
horizontal locations are proposed for drilling in early fall.


San Miguel Heavy Oil Project - Maverick Basin, South Texas

The Company is continuing with the San Miguel Heavy Oil Project's steam
injection pilot operations to determine the technical and economic feasibility
of cyclic steam injection to enhance oil recovery. Both pilot wells are
presently on a third cycle of injection and production, and additional cycles
will occur throughout 2007. Following discussions with our partners, a decision
has been made to expand the current pilot prior to the end of 2007. Initial
planning and procurement is therefore underway for the drilling of additional
wells and the procurement of long-lead items for facility modifications.
Discussions and planning are also underway for a second, 16 well production
pilot project to the north of the existing steam injection pilot facility. The
production pilot is presently projected to be operational in the second quarter
of 2008.


Palo Duro Shale Gas Exploration Project - North Texas

No additional drilling was undertaken during the quarter ended June 30, 2007 on
the Palo Duro Shale Gas Project. Efforts were concentrated on building the
required pipeline and facilities to tie-in and test the long term performance of
the two existing MacIntosh wells. The Company will continue to monitor the
results of the extended production testing as well as the results of other
operators in the basin in order to evaluate the long term economic viability of
the Palo Duro Shale Gas Project.


Pearl also announces that it has agreed to grant an aggregate of 250,000
incentive stock options to an officer of the Company. The options are
exercisable at a price of $3.75 per share over a period of 5 years and are
subject to vesting provisions.


Pearl is a public company focused on delivering disciplined growth by
establishing a North American portfolio of oil and gas projects with an emphasis
on large resource opportunities. Additional information on Pearl is available on
our website at www.pearleandp.com.


All references in this release to boe's are based on a 6 to 1 conversion ratio.
Boe's may be misleading, particularly if used in isolation. A boe conversion of
6 Mcf:1 bbl is based on an energy equivalency conversion method primarily
applicable at the burner tip and does not represent a value equivalency at the
wellhead.


Pearl's Certified Advisor on First North is E. Ohman J:or Fondkommission AB.

Forward-looking statements: This document contains statements about expected or
anticipated future events and financial results that are forward-looking in
nature and as a result, are subject to certain risks and uncertainties, such as
general economic, market and business conditions, the regulatory process and
actions, technical issues, new legislation, competitive and general economic
factors and conditions, the uncertainties resulting from potential delays or
changes in plans, the occurrence of unexpected events, and the Company's
capability to execute and implement its future plans. Actual results may differ
materially from those projected by management. For such statements, we claim the
safe harbour for forward-looking statements within the meaning of the Private
Securities Legislation Reform Act of 1995.

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