Chaparral Resources, Inc. Announces Year End Results and Operational and Financing Updates.

WHITE PLAINS, N.Y. -- Chaparral Resources, Inc. (OTCBB:CHAR) today reported net income of $8.52 million, or 22 cents per share, for the fiscal year ended December 31, 2004 compared to $2.06 million, or 5 cents per share, for the year ended December 31, 2003. The $6.46 million increase in our net income is primarily due to (i) higher oil prices, (ii) increased sales and (iii) the receipt of pre-emption fee income, partially offset by (iv) higher minority interest and taxes as a result of higher profits at Karakudukmunai (KKM), (v) higher transportation tariffs, (vi) higher workover costs, (vii) increased interest charges and (viii) the beneficial effect in 2003 of a change in accounting principle.

During 2004 we sold approximately 2,758,000 barrels of crude oil, recognizing $78.45 million, or $28.44 per barrel, in revenue. In comparison, we sold approximately 2,694,000 barrels of crude oil, recognizing $57.61 million in revenue, or $21.39 per barrel, for the year ended December 31, 2003. Transportation costs for the year ended December 31, 2004 were $14.05 million, or $5.09 per barrel, and operating costs associated with sales were $8.32 million, or $3.02 per barrel. In comparison, transportation costs for the year ended December 31, 2003 were $11.47 million, or $4.26 per barrel, and operating costs associated with sales were $5.92 million, or $2.20 per barrel.

In 2004, KKM drilled 16 wells, 12 completed as producers, three awaiting completion at year end and one water injector. KKM continued to expand and upgrade all field production facilities, with additions to field processing facilities, gathering stations and export infrastructure, to enable increased production and higher fluid throughput anticipated from ongoing drilling, well mechanisation plans and hydraulic fracturing. Production averaged 8,090 barrels of oil per day for the year ended December 31, 2004.

Work continued on converting wells to artificial lift, with eleven wells converted to sucker rod pumps (SRPs), one electrical submersible pump (ESP) installed, four wells converted from ESPs to SRPs and one screw pump replaced with a SRP. Full-scale water injection commenced in April 2004 and the system is now fully operational. Daily injection volume at the field is approximately 10,000 barrels of water per day. In late 2004, KKM performed a six-well hydraulic fracturing program to improve well productivity. Initial results from this program are encouraging, with wells showing a two to three fold increase in production.

KKM's development program for 2005 contemplates 16 wells being drilled, converting at least 15 more wells to artificial lift, converting three more wells to water injection wells, adding four new water injection wells and continuing with hydraulic fracturing work. A sedimentology study was undertaken in 2004 which should result in more productive new wells due to better locations. Management expects production from the Karakuduk Field to increase to 12,000 to 13,000 barrels of oil per day by year-end 2005.

In December 2004, after having received notice from KMG that it desired to sell its 40% equity interest in KKM, Chaparral exercised its right of first refusal to purchase the 40% equity interest in KKM at the price and on the terms specified in the notice, pursuant to an agreement with its majority stockholder, Nelson Resources Limited ("Nelson"). The transfer of the 40% interest from KMG to Chaparral occurred in December 2004, and the transfer from Chaparral to Nelson was completed in January 2005. The purchase price of $34.6 million paid by Chaparral to KMG was determined on an open tender, and the funds for this were made available to Chaparral by Nelson. In addition, Nelson paid the Company a fee of $1.0 million, as well as all documentation and transaction costs relating to the acquisition.

On March 24, 2005, KKM signed a $40 million Structured Crude Oil Pre-export Credit Facility Agreement with BNP Paribas (Suisse) SA, KBC Bank N.V. and others (the "BNP/KBC Facility"). Subject to meeting conditions precedent within 30 days of signing, funds from this facility will be available for use to cover any short-term working capital deficiencies and to pay down the existing loan with Kazkommertsbank. Amounts borrowed under the BNP/KBC Facility are repayable in 36 equal monthly installments commencing between six and seven months after the signing date. The interest rate is LIBOR plus 3.25% for the first 12 months and LIBOR plus 4.00% thereafter. The lenders also require that KKM implement a crude oil price hedging program, in a form satisfactory to the lenders. The borrowings under the BNP/KBC Facility are guaranteed by Nelson. In addition, on March 22, 2005, Chaparral and CAP-G signed a Promissory Note Amendment Agreement with Nelson. This provides for a prepayment of $1 million of the $4 million due to be repaid to Nelson on May 10, 2005 under the existing $4 million loan note and the replacement of the existing loan note with a new loan note for $3 million on substantially similar terms, but with an increase in the interest rate from 12% to 14% from May 10, 2005 and an extension of the maturity date of one year to May 10, 2006. The debt refinancing, coupled with current production and price levels, should enable the Company to meet all current financial obligations and continue with field development. As a result, Ernst & Young, Chaparral's auditors, no longer comment in their report on Chaparral's 2004 consolidated financial statements about doubts on our ability to continue as a going concern.

Simon Gill, Chief Executive Officer of Chaparral Resources, commented, "Nelson's involvement with Chaparral since May 2004 has resulted in a significant increase in the technical supervision and capability of KKM management. This has been reflected by their evaluation of the field production and drilling performance and the steps taken to design efficient artificial lift and locate wells in reservoir sweet spots. This work is beginning to show results and operational performance is expected to continue to improve in 2005".

Chaparral Resources, Inc. is an oil and gas development and production company. The Company's only operating asset is its participation in the development of the Karakuduk field, in the Republic of Kazakhstan, through KKM, which is the operating company. The Company has directly and indirectly a 60% ownership interest in KKM with the other 40% ownership interest being held by Nelson. Nelson, an independent oil company listed on the Toronto Stock Exchange and the Alternative Investment Market of the London Stock Exchange, holds a majority interest in Chaparral and operates several other producing oil fields in Kazakhstan. More information is available on the Company's web site, www.chaparralresources.com.

Information Regarding Forward-Looking Statements: Except for historical information contained herein, the statements in this News Release are forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties, which may cause the Company's actual results in future periods to differ materially from forecasted results. These risks and uncertainties include, among other things, volatility of oil prices, product demand, market competition, risks inherent in the Company's international operations, imprecision of reserve estimates and Chaparral's ability to replace and expand oil and gas reserves. These and other risks are described in the Company's Annual Report on Form 10-K and other filings with the Securities and Exchange Commission.

FINANCIAL HIGHLIGHTS
                 (in thousands, except per share data)

                                               Years Ended December 31
                                               -----------------------
                                                   2004        2003
                                               ----------- -----------
Revenue                                           $78,451     $57,615
Costs and expenses                                (50,280)    (43,562)
Other income/(expense)                            (12,529)     (8,889)
Income tax expense                                 (7,120)     (4,121)
Cumulative effect of change in accounting
 principle                                              -       1,018
                                               ----------- -----------
Net income available to common stockholders        $8,522      $2,061
                                               =========== ===========

Basic earnings per share:
Net income per share                                $0.22       $0.05
Weighted average number of shares
 outstanding (basic)                           38,209,502  38,209,502

Diluted earnings per share:
Net income per share                                $0.22       $0.05
Weighted average number of shares
 outstanding (diluted)                         38,407,283  38,209,502
                                               =========== ===========