Net cash provided by operating activities was a record $230.7 million for 2005, a 58 percent increase over $146.4 million reported for 2004. Operating cash flow, a non-GAAP measure, was also a record $241.6 million for 2005, or 55 percent above $156.0 million reported for 2004.

The increases in net income and cash flow were primarily due to increased natural gas revenues as a result of higher commodity prices and production volumes, and increased contributions from the Company’s ownership in Penn Virginia Resource Partners, L.P. (NYSE:PVR), which is reported under the coal and natural gas midstream segments below.

The increase in 2005 net income was reduced by increased interest expense and by non-cash unrealized losses on derivatives.

For the fourth quarter of 2005, operating income was a record $60.3 million and quarterly net income was a record $27.4 million, or $1.46 per diluted share, compared to fourth quarter 2004 operating income of $15.3 million and net income of $4.7 million, or $0.25 per diluted share.

Net cash provided by operating activities was a record $81.8 million, a 77 percent increase over $46.2 million reported for the fourth quarter of 2004 and28 percent higher than the previous record of $63.8 million established in the third quarterof 2005.

Operating cash flow, a non-GAAP measure, was a record $74.7 million, a 58 percent increase over the fourth quarter of 2004, and 12 percent higher than the previous record established in 2005’s third quarter.

As was the case with the full-year results for 2005, the increases in the fourth quarter 2005 results were primarily due to increased natural gas revenues caused by higher commodity prices and production volumes and increased contributions from the Company’s ownership in PVR, which is reported under the coal and natural gas midstream segments below. The increase in fourth quarter 2005 net income was reduced by increased interest expense and by non-cash unrealized losses on derivatives.

A. James Dearlove, Penn Virginia President and CEO, said, "The success of our growth strategy in all of our businesses and record commodity prices resulted in recordsetting performance for the fourth quarter and full-year 2005.

"Our increased operating income and cash flows were the direct result of our record oil and natural gas production levels and price realizations. We intend to continue to exploit our expertise in unconventional plays, therefore approximately 75 percent of our $208 million oil and gas capital expenditures budget for 2006 is devoted to our large, core development projects in Appalachian horizontal coalbed methane (HCBM), the Cotton Valley play in east Texas, and the Mississippi Selma Chalk. Our exploration spending will be spread among projects in south Louisiana, the Williston Basin and various promising ideas involving shale, CBM and tight sands. The goal of our exploration program is to identify meaningful resource plays to supplement our core areas."