Tri-Valley Corporation Reports Second Quarter 2011 Financial Results

Tri-Valley Corporation (NYSE Amex: TIV) today announced its financial
results for the second quarter ended June 30, 2011. Oil and gas
production revenues increased 2% to $474,000 in the second quarter of
2011 compared with $465,000 in the second quarter of 2010, due to higher
oil prices partially offset by a slight decline in net oil production.
Net production in the recent second quarter totaled 6,454 barrels of oil
compared with 6,488 barrels of oil in the same quarter of 2010, as
reported to the California Division of Oil, Gas & Geothermal Resources
(DOGGR). Net production costs increased 86% in the 2011 second quarter
compared with the same quarter a year ago, reflecting increased drilling
activity at the Company′s Claflin oil project near Bakersfield.

'The slight increase in oil and gas revenues in the recent quarter
compared with the prior year was below our expectations and was due to a
temporary and unforeseen decrease in production at our Pleasant Valley
oil project,? said Maston Cunningham, President and CEO of Tri-Valley.
'Due to a mechanical failure, we lost steam production capability during
the middle of the quarter and were not able to resume steam injection
until late June after repairs were completed. We expect net native oil
production at Pleasant Valley for the third quarter to approximate 5,299
barrels of oil per day or slightly under the second quarter of the year
as steam injection and affected oil production resumes. Production at
Claflin increased 300% from the second quarter last year, and we expect
it to continue to grow as the new wells that were drilled during the
recent quarter come on line. There are currently twelve wells on the
site, including the eight that were recently drilled. Of the new wells,
three have been steamed, and production has begun from all three. We
anticipate that all eight new wells will be in production by mid
October.?

'Turning to our minerals business, we achieved an important milestone on
July 1st with the execution of a Definitive Agreement between our Select
Resources subsidiary and US Gold Corporation for the exploration and
development of the Richardson minerals project in Alaska,? Mr.
Cunningham continued. 'Under the terms of the agreement, US Gold
acquired an exploration lease for Richardson, along with an exclusive
option to purchase a 60% interest in the project and enter into a joint
venture with Select for its development. Work began on the project on
July 5^th. We received our first $200,000 payment from US Gold
specified under the agreement, and it will be recognized in the third
quarter results. In addition, we anticipate $200,000 in annualized cost
savings in maintenance for the Richardson project. Those costs will be
assumed by US Gold. This was a significant step in our initiative to
monetize our mineral assets in Alaska. We are also pursuing a similar
arrangement with an experienced operational and financial partner for
our Shorty Creek property.?

'We ended the second quarter with $1.5 million in cash and stockholders′
equity of $11.4 million, much improved from the $581,000 in cash and
$6.2 million in stockholders′ equity at the end of December 2010. The
substantial improvement in our cash balance and capital position was the
result of the successful raise of capital through the sale of common
stock under our at-the-market (ATM) equity offering programs with C. K.
Cooper & Company and the private placement completed in April, 2011.
These capital raising activities provided us with the capital we needed
to expand the number of wells at Claflin as well as to fund our ongoing
operations.?

Operational highlights during the second quarter of 2011 through today
include:

• 
  Executed a Definitive Agreement with US Gold Corporation for a
  four-year Exploration Lease and Purchase Option for the exploration
  and development of the Richardson gold project in Alaska in July;
  
• 
  Closed a private placement financing with a select group of
  institutional and accredited investors, issuing 10.1 million shares of
  common stock and raising net proceeds of $4.7 million to provide
  funding for the completion of the first drilling phase of the Claflin
  oil project in the Edison oil field near Bakersfield in April;
  
• 
  Completed the first drilling phase at Claflin, drilling eight new
  vertical wells, up from the six wells originally planned;
  
• 
  Commenced the initial steam injection cycle at Claflin in June 2011
  and began first production from the new wells starting in July 2011;
  
• 
  Entered into a long-term lease for new office space in Bakersfield to
  significantly reduce costs and improve efficiency;
  
• 
  Reviewed the business strategy and recent corporate developments with
  analysts, investors and potential investors at the Independent
  Petroleum Association of America (IPAA) Oil and Gas Symposium in NYC
  in April and at the Global Hunter Securities Conference in San
  Francisco in July; and.
  
• 
  Reached preliminary terms with the OPUS Partners Special Committee on
  restructuring and resolution of alleged claims that will support the
  continued development and financing of the Pleasant Valley oil field
  project.
  

Second Quarter Financial Highlights

Total revenues for the second quarter of 2011 were $503,000 compared
with $1.6 million in the second quarter of 2010. Included in last year′s
second quarter revenues was a $1.1 million gain on the sale of
non-strategic assets in California. Oil and gas revenues increased 2% to
$474,000 compared with $465,000 in the same period last year.

Total costs and expenses were $3.1 million compared with $5.8 million in
the second quarter last year, a decrease of 46%. The decline was largely
due to the elimination of warrant expense which totaled $2.9 million in
the second quarter last year. Mining exploration expenses were down 25%
to $64,000, reflecting cost savings from the sale of the Admiral Calder
calcium carbonate quarry in December 2010. Oil production costs
increased to $460,000 in the recent second quarter compared with
$247,000 last year, primarily due to the drilling of eight new wells at
Claflin. General and administrative expenses decreased 26%, as a result
of the staff reductions implemented by the Company over the past year.
The Company incurred an impairment loss in the recent second quarter of
$503,000, reflecting the write-down of expired leases.

The net loss in the recent first quarter was $2.6 million, or $0.04 per
share, compared with a net loss of $4.2 million, or $0.11 per share, in
the second quarter of 2010. Weighted average shares outstanding in the
recent second quarter totaled 65.7 million compared with 36.9 million in
the second quarter of 2010, primarily reflecting the sale of common
stock through the Company′s ATM facility with C.K. Cooper & Company and
the private placement financing completed in April 2011 for 10.1 million
shares.

Six Months′ Financial Highlights

Total revenues through the first six months of 2011 were $1.2 million
compared with $2.6 million in the same period of 2010. During the
six-month period last year, the Company recognized gains on the sale of
assets of $1.7 million. Oil and gas revenues grew 23% in the first half
of 2011 compared to the first half of 2010.

Total costs and expenses were $6.3 million in the recent first half
versus $9.0 million in the first half of last year. The decrease was
largely due to a substantial reduction in warrant expense which totaled
$4.0 million through the first six months of 2010. Mining exploration
expenses declined 53% reflecting cost savings from the sale of the
Admiral Calder calcium carbonate quarry in December 2010. Oil production
costs were up 71% due to the increased drilling activity at Claflin. The
recent six-month period also included $916,000 in impairment charges for
the write-down of expired leases.

The net loss of the first six months of 2011 was $5.1 million, or $0.09
per share, compared with a net loss of $6.4 million, or $0.18 per share
for the first half of 2010.

Conference Call

The Company has scheduled a conference call to discuss its second
quarter 2011 results and current business developments today, August 22,
2011, at 4:30 p.m. ET. To access the call, please dial 877-941-9205. To
access the live webcast of the call, visit Tri-Valley′s website at

An audio replay will be available for seven days following the call at
800-406-7325. ?The password required to access the replay is 4464851#. An
archived webcast will also be available at

About Tri-Valley

Tri-Valley Corporation explores for and produces oil and natural gas in
California and has two exploration-stage gold properties in Alaska.
Tri-Valley is incorporated in Delaware and is publicly traded on the
NYSE Amex exchange under the symbol 'TIV.' Our Company website, which
includes all SEC filings, is

Note Regarding Forward-Looking Statements

All statements contained in this press release that refer to future
events or other non-historical matters are forward-looking statements.We have attempted to identify forward-looking statements by
terminology including 'anticipates,? 'believes,? 'can,? 'continue,?
'could,? 'estimates,? 'expects,? 'hope,? 'intends,? 'may,? 'plans,?
'potential,? or 'predicts,? or the negative of these terms or other
comparable terminology. Although we do not make forward-looking
statements unless we believe we have a reasonable basis for doing so, we
cannot guarantee their accuracy. These statements are only predictions
based on management′s expectations as of the date of this press release,
and involve known and unknown risks, uncertainties and other factors,
including: our ability to obtain additional funding; fluctuations in oil
and natural gas prices; imprecise estimates of oil reserves; drilling
hazards such as equipment failures, fires, explosions, blow-outs, and
pipe failure; shortages or delays in the delivery of drilling rigs and
other equipment; problems in delivery to market; adverse weather
conditions; compliance with governmental and regulatory requirements;
geographical concentration of oil and gas reserves in the State of
California; changes in, or inability to enter into or maintain,
strategic and joint venture partnerships; pending and threatened
lawsuits against us; potential rescission rights stemming from our
potential violation of Section 5 of the Securities Act of 1933; our
ability to consummate the OPUS restructuring transaction; our ability to
satisfy the OPUS Preferred Return Amount; and such other risks and
factors that are discussed in our filings with the Securities and
Exchange Commission from time to time, including under 'Part I, Item 1A.
Risk Factors? and 'Part II, Item 7. Management′s Discussion and Analysis
of Financial Condition and Results of Operations,? contained in
Tri-Valley′s Annual Report on Form 10-K for the year ended December 31,
2010, and under 'Part I, Item 2. Management′s Discussion and Analysis of
Financial Condition and Results of Operations? and 'Part II, Item 1A.
Risk Factors,? contained in Tri-Valley′s Quarterly Reports on Form 10-Q
for the quarters ended March 31 and June 30, 2011, respectively. Except
as required by law, Tri-Valley undertakes no obligation to update or
revise publicly any of the forward-looking statements after the date of
this press release to conform such statements to actual results or to
reflect events or circumstances occurring after the date of this press
release.