Chaparral Resources Inc. Announces Management Changes and Drilling Plans.

HOUSTON--(BUSINESS WIRE)--Jan. 12, 1999--Chaparral Resources Inc. (Nasdaq:CHAR) announced today that Howard Karren has resigned as chairman, president and chief executive officer for personal reasons. He is succeeded by Mr. John McMillian, currently a director of the company, who has been selected by the Board of Directors to replace Mr. Karren. Mr. McMillian is the former chairman, president and chief executive officer of Allegheny & Western Energy Corporation and of Northwest Energy Corporation. Mr. McMillian is also a director of Marker International and Excalibur Technologies. Mr. McMillian will become chairman and chief executive officer and has also assumed the duties of president on an interim basis.

The company also announced that Mr. J. Michael Muckleroy has resigned as a director and has been replaced by Mr. James A. Jeffs, a former director of the company. Mr. Jeffs, age 46, is managing director and chief investment officer for Whittier Trust Company. He has been instrumental in helping arrange financing for the company in the past and is expected to continue to assist the company with its financial and operational efforts in the future.

Chaparral Resources Inc. is an international oil and gas exploration and production company. The company participates in the development of the Karakuduk Field through the Karakuduk Munay Inc. Joint Venture ("KKM") of which it is the operator. The company controls a 50% beneficial ownership interest in KKM with the other 50% ownership interest being held by Kazakh investors, including KazakhOil, the government-owned oil company.

Mr. McMillian stated that he looks forward to working with the company and its Kazakh partners to achieve the full development potential of the Karakuduk Field. He also noted that a drilling rig is currently on location in the Field and is expected to begin drilling operations in January 1999. It is anticipated that this drilling rig will enable the company to increase production and generate additional revenue through crude oil sales. The company is currently producing approximately 700 barrels of oil per day from two wells which were placed on production during 1998.

The company also announced that it has requested permission from the Kazakh government to combine its separate 1998 and 1999 capital expenditure programs into one program of $46.5 million, of which approximately $16.5 million has been spent to date. The Kazakh government has informed the company that it intends to approve the company's request, but the company has not received such approval.

Information Regarding Forward-Looking Statements: Except for historical information contained herein, the statements in this Press 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 the company'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.