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FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
 
 
FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT (this “Amendment”) is
entered into as of August 9, 2007, by and among PETROLEUM DEVELOPMENT
CORPORATION (the “Borrower”), CERTAIN SUBSIDIARIES OF THE BORROWER, as
Guarantors (the “Guarantors”), the LENDERS party hereto (the “Lenders”) and
JPMORGAN CHASE BANK, N.A., as Administrative Agent (the “Administrative
Agent”).  Unless the context otherwise requires or unless otherwise expressly
defined herein, capitalized terms used but not defined in this Amendment have
the meanings assigned to such terms in the Credit Agreement (as defined below).
 
WITNESSETH:
 
WHEREAS, the Borrower, the Guarantors, the Administrative Agent and the Lenders
have entered into that certain Amended and Restated Credit Agreement dated as of
November 4, 2005 (as amended, supplemented or otherwise modified from time to
time, the “Credit Agreement”); and
 
WHEREAS, the Borrower has requested that the Administrative Agent and the
Lenders amend the Credit Agreement to among other things, modify certain
convents, and the Administrative Agent and the Lenders have agreed to do so on
the terms and conditions hereinafter set forth;
 
NOW, THEREFORE, for and in consideration of the mutual covenants and agreements
herein contained and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged and confessed, the Borrower, the
Guarantors, the Administrative Agent and the Lenders hereby agree as follows:
 
SECTION 1.  Amendments to Credit Agreement.  Subject to the satisfaction or
waiver in writing of each condition precedent set forth in Section 5 of this
Amendment, and in reliance on the representations, warranties, covenants and
agreements contained in this Amendment, the Credit Agreement shall be amended in
the manner provided in this Section 1.
 
1.1  Additional Definitions.  Section 1.01 of the Credit Agreement shall be and
it hereby is amended by inserting the following definitions in appropriate
alphabetical order:
 
  “Capital Markets Event” means the receipt by Borrower of net proceeds of not
less than $200,000,000 from the issuance of Indebtedness of Borrower or Equity
Interests of Borrower on terms and conditions acceptable to the Required Lenders
and with the prior written consent of Required Lenders.
 
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   “Eligible Assignee” means any Person that qualifies as an assignee pursuant
to Section 11.04(b)(i); provided that, notwithstanding the foregoing, “Eligible
Assignee” shall not include the Borrower or any of the Borrower’s Affiliates or
Subsidiaries.
 
  “First Amendment” means that certain First Amendment to Amended and Restated
Credit Agreement, dated August 9, 2007, by and among the Borrower, the
Guarantors, the Lenders and the Administrative Agent.
 
  “Suspension Period” means the period beginning August 9, 2007,  and ending on
the earlier of (a) the occurrence of a Capital Market Event and (b) July 1,
2008.
 
1.2  Amended Definitions.  Section 1.01 of the Credit Agreement shall be and it
hereby is amended by amending and restating the following definitions to read in
their entirety as follows:
 
  “Applicable Rate” means, with respect to any ABR Loan or Eurodollar Loan, or
with respect to the Unused Commitment Fees payable hereunder, as the case may
be, the applicable rate per annum set forth below under the caption “ABR
Spread”, “Eurodollar Spread” or “Unused Commitment Fee Rate”, as the case may
be, based upon the Borrowing Base Usage applicable on such date, (a) for any day
other than during the Suspension Period:
 
Borrowing Base Usage:
ABR
Spread
Eurodollar
Spread
Unused Commitment Fee Rate
Equal to or greater than 90%
0.375%
1.875%
0.375%
Equal to or greater than 75% and less than 90%
0.125%
1.625%
0.375%
Equal to or greater than 50% and less than 75%
0.000%
1.375%
0.375%
Less than 50%
0.000%
1.125%
0.250%

 
and (b) for any day during the Suspension Period:
 
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Borrowing Base Usage:
ABR
Spread
Eurodollar
Spread
Unused Commitment Fee Rate
Equal to or greater than 90%
0.750%
2.250%
0.375%
Equal to or greater than 75% and less than 90%
0.500%
2.000%
0.375%
Equal to or greater than 50% and less than 75%
0.375%
1.750%
0.375%
Less than 50%
0.375%
1.500%
0.250%

 
Each change in the Applicable Rate shall apply during the period commencing on
the effective date of such change and ending on the date immediately preceding
the effective date of the next change.
 
1.3  Termination and Reduction of the Aggregate Revolving Commitment.  Section
2.02(d) of the Credit Agreement shall be and it hereby is amended and restated
in its entirety to read as follows:
 
(d)           With respect to any sale, transfer or disposition of Borrowing
Base Properties, the Borrowing Base shall be automatically reduced by an amount
equal to the value assigned to such Borrowing Base Properties by the
Administrative Agent in connection with the most recent Redetermination of the
Borrowing Base preceding the date of such sale (or in connection with the
determination of the Initial Borrowing Base with respect to any sale occurring
prior to the first Redetermination of the Borrowing Base).
 
1.4  Restricted Payments. Section 7.06 of the Credit Agreement shall be and it
hereby is amended and restated in its entirety to read as follows:
 
  Section 7.06.  Restricted Payments.  The Borrower will not, nor will it permit
any of its Restricted Subsidiaries to, declare or make, or agree to pay or make,
directly or indirectly, any Restricted Payment, except that (a) the Borrower may
declare and pay dividends with respect to its Equity Interests payable solely in
additional shares of its common stock, (b) the Borrower may make Restricted
Payments pursuant to and in accordance with stock option plans or other benefit
plans for management or employees of the Borrower and its Restricted
Subsidiaries in an aggregate amount not to exceed $5,000,000 in any fiscal year,
(c) any Restricted Subsidiary may make Restricted Payments to the Borrower or
any Guarantor, and (d) at any time other than during the Suspension Period and
so long as no Default shall have occurred and be continuing or would result from
the making of such Restricted Payment, (i) the Borrower may declare and pay
dividends with respect to its Equity Interests during any fiscal year of the
Borrower in an aggregate amount not to exceed 50% of its Consolidated Net Income
accrued during the period from the beginning of such fiscal year to the date
such dividend is declared and (ii) provided that Borrowing Base Usage is less
than 80% both before and after such Restricted Payment, the Borrower may
repurchase its Equity Interests.
 
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1.5  Financial Covenants (Consolidated Current Ratio).  Section 7.11(a) of the
Credit Agreement shall be and it hereby is amended and restated in its entirety
to read as follows:
 
  (a)           The Borrower will not permit the Consolidated Current Ratio as
of the end of any fiscal quarter ending on or after December 31, 2005 (other
than any fiscal quarter ending during the Suspension Period), to be less than
1.00 to 1.00.
 
1.6  Notices. Clause (ii) of Section 11.01 of the Credit Agreement shall be and
they hereby are amended and restated in its entirety to read as follows:
 
  (ii)           if to the Administrative Agent or Issuing Bank, to JPMorgan
Chase Bank, N.A., Mail Code IL1-0010, 10 South Dearborn, Chicago, Illinois,
60603-2003, Telecopy No.: (312) 385-7098, Attention: Mi Kim, with a copy to
JPMorgan Chase Bank, N.A., Mail Code TX2-S038, 712 Main Street, Houston, Texas
77002, Telecopy No. (713) 216-7770, Attention:  Jo Linda Papadakis;
 
SECTION 2.  Conditions.  The amendments to the Credit Agreement contained in
Section 1 of this Amendment shall be effective upon the satisfaction of each of
the conditions set forth in this Section 2.
 
2.1  Execution and Delivery.  Each Credit Party, each Lender and the
Administrative Agent shall have executed and delivered this Amendment.
 
2.2  Fees.  The Administrative Agent shall have received (a) for the benefit of
the Lenders, an upfront fee in an amount equal to $250,000 and (b) all other
fees and other amounts due and payable to Administrative Agent and the Lenders
on or prior to the date hereof, including all fees due and payable with respect
to the Aggregate Commitment Increase described in Section 2.4 hereof.
 
2.3  Assignments.  The assignments of a portion of the rights and obligations
under the Credit Agreement of JPMorgan Chase Bank, N.A. and BNP Paribas to
Wachovia Bank, N.A., pursuant to an Assignment and Assumption shall have
occurred.
 
2.4  Aggregate Commitment Increase.  The Aggregate Commitment Increase to
$200,000,000 shall have become effective.
 
2.5  No Default.  No Default shall have occurred and be continuing.
 
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2.6  Other Documents.  The Administrative Agent shall have received such other
instruments and documents incidental and appropriate to the transaction provided
for herein as the Administrative Agent or its special counsel may reasonably
request, and all such documents shall be in form and substance satisfactory to
the Administrative Agent.
 
SECTION 3.      Representations and Warranties of Borrower.  To induce the
Lenders to enter into this Amendment, each Credit Party hereby represents and
warrants to the Lenders as follows:
 
3.1  Reaffirmation of Representations and Warranties/Further Assurances.  After
giving effect to the amendments herein, each representation and warranty of such
Credit Party contained in the Credit Agreement or in any other Loan Document is
true and correct in all material respects on the date hereof (except to the
extent such representations and warranties relate solely to an earlier date).
 
3.2  Corporate Authority; No Conflicts.  The execution, delivery and performance
by such Credit Party of this Amendment and all documents, instruments and
agreements contemplated herein are within such Credit Party’s corporate or other
organizational powers, have been duly authorized by necessary action, require no
action by or in respect of, or filing with, any court or agency of government
and do not violate or constitute a default under any provision of any applicable
law or other agreements binding upon such Credit Party or result in the creation
or imposition of any Lien upon any of the assets of such Credit Party.
 
3.3  Enforceability.  This Amendment constitutes the valid and binding
obligation of such Credit Party enforceable in accordance with its terms, except
as (i) the enforceability thereof may be limited by bankruptcy, insolvency or
similar laws affecting creditor’s rights generally, and (ii) the availability of
equitable remedies may be limited by equitable principles of general
application.
 
SECTION 4.       Miscellaneous.
 
4.1  Reaffirmation of Loan Documents and Liens.  Any and all of the terms and
provisions of the Credit Agreement and the Loan Documents shall, except as
amended and modified hereby, remain in full force and effect.  Each Credit Party
hereby agrees that the amendments and modifications herein contained shall in no
manner affect or impair the liabilities, duties and obligations of any Credit
Party under the Credit Agreement and the other Loan Documents or the Liens
securing the payment and performance thereof.
 
4.2  Parties in Interest.  All of the terms and provisions of this Amendment
shall bind and inure to the benefit of the parties hereto and their respective
successors and assigns.
 
4.3  Legal Expenses.  Each Credit Party hereby agrees to pay all reasonable fees
and expenses of special counsel to the Administrative Agent incurred by the
Administrative Agent in connection with the preparation, negotiation and
execution of this Amendment and all related documents.
 
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4.4  Counterparts.  This Amendment may be executed in one or more counterparts
and by different parties hereto in separate counterparts each of which when so
executed and delivered shall be deemed an original, but all such counterparts
together shall constitute but one and the same instrument; signature pages may
be detached from multiple separate counterparts and attached to a single
counterpart so that all signature pages are physically attached to the same
document.  However, this Amendment shall bind no party until each Credit Party,
the Lenders (or at least the required percentage thereof), and the
Administrative Agent have executed a counterpart.  Delivery of photocopies of
the signature pages to this Amendment by facsimile or electronic mail shall be
effective as delivery of manually executed counterparts of this Amendment.
 
4.5  Complete Agreement.  THIS AMENDMENT, THE CREDIT AGREEMENT, AND THE OTHER
LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR ORAL AGREEMENTS OF THE
PARTIES.  THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
 
4.6  Headings.  The headings, captions and arrangements used in this Amendment
are, unless specified otherwise, for convenience only and shall not be deemed to
limit, amplify or modify the terms of this Amendment, nor affect the meaning
thereof.
 
[Remainder of Page Intentionally Blank.  Signature Pages Follow.]
 

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IN WITNESS WHEREOF, the parties have caused this First Amendment to Amended and
Restated Credit Agreement to be duly executed as of the date first above
written.
 

BORROWER:
PETROLEUM DEVELOPMENT CORPORATION
By:                                                                       
Name:
Title:
   
GUARANTOR:
RILEY NATURAL GAS COMPANY
By:                                                                       
Name:
Title:
 

 
Signature Page

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JPMORGAN CHASE BANK, N.A. (successor by merger to Bank One, N.A. (Illinois)),
individually and as Administrative Agent,
By:                                                                       
Jo Linda Papadakis
Vice President

 
Signature Page

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BNP PARIBAS,
as a Lender and as Syndication Agent
     
By:                                                                       
Name:
Title:
     
By:                                                                       
Name:
Title:

Signature Page

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WACHOVIA BANK, N.A., as a Lender
     
By:                                                                       
Philip Trinder, Director
 

Signature Page

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