QUARTERLY REPORT FOR THE PERIOD ENDING 31 MARCH 2007

HIGHLIGHTS FOR THE QUARTER

Exploration Activity - Australia and USA

1. Commencement of fourteen well exploration program over next eight months in South Australian and Queensland Cooper Basin where Victoria Petroleum holds largest gross and net acreage exploration area in 14 permits with average 30% interest.
2. Continuing exploration success in South Australian Cooper Basin permits with April 2007 oil discovery at Wirraway-1 in PEL 104 following on from initial Growler-1 oil discovery in September 2006, maintaining 100% exploration success rate.
3. Recovery of oil from Wirraway-1 on open hole drill stem test from Birkhead sands at rate of 67 barrels of oil per day from gross 17 metre interval in April 2007.
4. Wirraway and Growler oil discoveries providing further confirmation of possible aerially significant "Jurassic oil fairway" in western portion of PEL 104 and PEL 111 covering approximately 750 square kms with potential with further exploration success to contain up to 100 million barrels of oil in place. Over 20 prospects and leads mapped. Seven drillable prospects have been identified with unrisked P50 recoverable reserves of 28 million barrels of oil in the Birkhead formation, if oil is present.
5. Continuing appraisal of Wirraway and Growler oil discoveries to follow Wirraway-1 with Growler-2.
6. Drilling success at Wilpinnie-4 on the Tomcat Prospect, PPL 93/PEL 115, in January 2007 with Wilpinnie-4 cased and suspended as a potential future oil producer to be production tested by Santos in June 2007.
7. The potential for the oil pool in Wilpinnie-4 to extend from PPL 93 into PEL 115 is considered promising based on the up dip gross oil column of 18 metres drilled and partially tested in Wilpinnie-4 at an inferred rate of 144 barrels of oil per day. The Tomcat oil pool is interpreted to straddle PEL 115 and PPL 93 with up to 6 million barrel oil potential subject to production testing of Wilpinnie-4 and up dip drilling in PEL 115. Wilpinnie-4 was drilled by Santos under a farmout agreement with Santos and the PPL 93 parties.
8. In southwest Queensland Cooper Basin permits, a three well drilling program planned to start in July 2007 in the Barta and Wompi blocks of ATP 752P. Candidates for drilling are the NW Cook, Vancouver and Nora testing a cumulative unrisked recoverable oil potential up to 18 million barrels, if oil is present. All drilling is adjacent to Santos oil production and infrastructure.
9. 9 Successful drilling of the first of three shallow exploration wells based on 3D seismic data on the Margarita onshore Texas Gulf Coast gas exploration project with El Viejito-1, and Dos Dedos-1 being gas discoveries and Milagro-1 being an oil discovery. Dos Dedos and Milagro-1 have been connected to sales line and are producing at a rate of 0.6 million cubic feet per day.
10. 10 Planned commencement of drilling in mid May 2007 of next three shallow wells in the program, Agavero-1, Dona Carlota-1 and Climaco-1 targeting cumulative recoverable reserves of 3.1 billion cubic feet of gas, if gas is present.
11. 11 Eighteen exploration and appraisal wells are planned over the next six months as per the attached drilling schedule with twelve of the wells in the SA and Qld Cooper Basin.

Development and Production Activity - Australia and USA

12. Total gross production over the quarter estimated at 309,254 barrels of oil equivalent with net 23,538 barrels of oil equivalent to Victoria Petroleum at an average production rate of 262 barrels of oil equivalent per day.
13. High oil prices during the quarter provided estimated oil and gas net cash flow of $1.26 million on gross oil and gas sales of $1.89 million.
14. The Mirage and Ventura oil fields in PEL 115, South Australian Cooper Basin continued production during the quarter at an average combined rate of 256 barrels of oil per day. Current Proved and Probable (2P) recoverable reserves for the fields are estimated at 1.59 million barrels. A Field Development Plan to guide development drilling planned for the second half 2007 is currently in preparation.
15. Production testing of the September 2006 Growler-1 oil discovery in the South Australian Cooper Basin during the quarter to evaluate the recovery of 36 barrels of 49 degree API oil with no water from a 12 metre interval of the Birkhead formation during a two and a half hour open hole drill stem test achieved a stabilised flow rate of the order of 30 barrels of oil per day. Analysis of the data from this test will be performed to determine the likely flow rates of the well on pump.
16. Further work on the Eagle Oil Pool Development Project is currently awaiting an independent report evaluating past operations and proposing a forward drilling and evaluation program. Upon evaluation of this report and following farmout of Victoria Petroleum's interest in the Eagle Oil Pool Development Project, a further well is planned to be drilled in the second half of 2007 to further appraise the Eagle Oil Pool with its potential to contain up to 34 million barrels of oil and 58 billion cubic feet of gas.
17. Production testing of the Wiplinnie-4 oil zone within the Tomcat oil pool is planned for June 2007 to evaluate the wells production capabilities and the extent to which the Tomcat oil pool may extend into PEL 115.
18. It is anticipated that by the end of calendar 2007 that with successful development drilling from existing oil discoveries, the current and planned future Victoria Petroleum net oil and gas production will generate net cash flow estimated at $5.5 million for the year (calculated at US$55/ bbl and US$6.50/mcf). A return to higher oil prices through 2007 will increase this net cash flow estimate for calendar 2007.
19. Victoria Petroleum development and production activities in Australia and USA have being carried out against a background of historical high oil prices in the range of A$70-A$80 per barrel.

Other Assets & Corporate Activity

20. Victoria Petroleum N.L. has a 5.3% interest in Samson Oil & Gas Limited, an active oil and gas explorer and producer in North America listed on the Australian Stock Exchange.
21. Victoria Petroleum N.L. has a 33 1/3% interest in the public unlisted geothermal energy company Greenearth Energy Limited, managed by Lakes Oil N.L., also a 33 1/3% shareholder. Greenearth Energy was granted two promising geothermal exploration licenses in Victoria, GEL 12 and 13 adjacent to and containing the Trifon-2 well that has flowed steam and hot water at 90 degrees C from the relatively shallow depth of 2,200 metres. Greenearth Energy is planned to list in the second half of 2007 with an entitlement to Victoria Petroleum shareholders.

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