Palisades Petroleum Has Signed Joint Operating Agreement

Palisades Petroleum Corporation (PINK SHEETS: PAPT) is pleased to announce additional developments on its North Buffalo Prospect in Chouteau County, Montana.

In early July, the Company signed a Joint Operating Agreement with Cline Production Company of Billings, Montana. The Agreement appoints Cline Production Company as the operator for the North Buffalo Prospect, which is a shallow gas prospect targeting the Bow Island formation. The well partners own approximately 2,900 leasehold acres in the prospect.

Cline has permitted two wells on the prospect. The initial well will off-set a 1989 Exxon www.exxonmobil.com discovery that tested 802 MCFG/D (Eight Hundred and Two Thousand Cubic Feet of Gas per day) from the Bow Island formation. This well is set to be drilled upon the scheduled availability of the drilling rig.

A gas gathering line is located within 1/4 mile of the initial well, the close proximity of which will expedite gas sales.

The parties to the Joint Operating Agreement are:

Palisades Petroleum Corporation        50.00%
Cline Production Company               27.50%
PBP Resources, LLC                     20.00%
Brave River Production, LLC             2.50%

This Agreement and the well partners supersede the arrangement announced in a News Release dated February 21, 2006.

Further information on the progress of the Company's activities will be presented on a timely basis.

Disclaimer: This announcement may contain forward-looking statements which involve risks and uncertainties that include, among others, limited operating history, limited access to operating capital, factors detailed in the accuracy of geological and geophysical results including drilling and seismic reports; the ability to close the acquisition of Oil and Gas exploration properties, and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. More information is included in Palisades Petroleum Corporation filings with the Pink Sheets LLC and may be accessed at http://www.pinksheets.com.

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