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| PETROLEUM      DEVELOPMENT CORPORATION                                             |
|------------------------------------------------------------------------------------|
| Consolidated      Balance Sheets                                                   |
| (unaudited;      in thousands, except share and per share data)                    |
|                                                                               |   |   |   |   |
| December      31,                                                                  |   | 2007 |   |  2006 |
| Assets                                                                             |   |   |   |   |
| Current      assets:                                                               |   |   |   |   |
| Cash      and cash equivalents                                                     |   |  $         84,751 |   |  $       194,326 |
| Restricted      cash - current                                                     |   |             14,773 |   |                  519 |
| Accounts      receivable, net                                                      |   |             60,024 |   |             42,600 |
| Accounts      receivable - affiliates                                              |   |             11,537 |   |               9,235 |
| Inventories                                                                        |   |               2,248 |   |               3,345 |
| Fair      value of derivatives                                                     |   |               4,817 |   |             15,012 |
| Other      current assets                                                          |   |             13,643 |   |               5,977 |
| Total      current assets                                                          |   |           191,793 |   |           271,014 |
| Properties      and equipment, net                                                 |   |           845,864 |   |           394,217 |
| Restricted      cash - long term                                                   |   |               1,294 |   |           192,451 |
| Goodwill                                                                           |   |                       - |   |               6,783 |
| Other      assets                                                                  |   |             11,528 |   |             19,822 |
| Total      Assets                                                                  |   |  $    1,050,479 |   |  $       884,287 |
|                                                                               |   |   |   |   |
| Liabilities      and Shareholders' Equity                                          |   |   |   |   |
| Current      liabilities:                                                          |   |   |   |   |
| Accounts      payable                                                              |   |  $         88,502 |   |  $         67,675 |
| Accounts      payable - affiliates                                                 |   |               3,828 |   |               7,595 |
| Short      term debt                                                               |   |                       - |   |             20,000 |
| Production      tax liability                                                      |   |             21,330 |   |             11,497 |
| Other      accrued expenses                                                        |   |             12,913 |   |               9,685 |
| Deferred      gain on sale of leaseholds                                           |   |                       - |   |               8,000 |
| Federal      and state income taxes payable                                        |   |                  901 |   |             28,698 |
| Fair      value of derivatives                                                     |   |               6,291 |   |               2,545 |
| Advances      for future drilling contracts                                        |   |             68,417 |   |             54,772 |
| Funds      held for distribution                                                   |   |             39,823 |   |             31,367 |
| Total      current liabilities                                                     |   |           242,005 |   |           241,834 |
| Long-term      debt                                                                |   |           235,000 |   |           117,000 |
| Deferred      gain on sale of leaseholds                                           |   |                       - |   |             17,600 |
| Other      liabilities                                                             |   |             19,968 |   |             19,400 |
| Deferred      income taxes                                                         |   |           136,490 |   |           116,393 |
| Asset      retirement obligation                                                   |   |             20,731 |   |             11,916 |
| Total      liabilities                                                             |   |           654,194 |   |           524,143 |
|                                                                               |   |   |   |   |
| Commitments      and contingent liabilities                                        |   |   |   |   |
|                                                                               |   |   |   |   |
| Minority      interest in consolidated limited liability company                   |   |                  759 |   |                       - |
|                                                                               |   |   |   |   |
| Shareholders'      equity:                                                         |   |   |   |   |
| Common      shares, par value $.01 per share; authorized 50,000,000                |   |   |   |   |
|  shares;      issued:  14,907,679 in 2007 and 14,834,871 in    2006 |   |                  149 |   |                  148 |
| Additional      paid-in capital                                                    |   |               2,559 |   |                    64 |
| Retained      earnings                                                             |   |           393,044 |   |           360,102 |
| Treasury      shares at cost, 5,894 shares in 2007 and 4,706 in 2006               |   |                (226) |   |                (170) |
| Total      shareholders' equity                                                    |   |           395,526 |   |           360,144 |
| Total      Liabilities and Shareholders' Equity                                    |   |  $    1,050,479 |   |  $       884,287 |