9M2010 Operating results

PRESS-RELEASE

KMG EP announces operating results for the 3Q10

Astana, October 20, 2010. JSC KazMunaiGas Exploration Production ("KMG EP" or "the Company"), announces that in the first nine months of 2010 it produced 9,946 thousand tonnes of crude oil (270kbopd) including 1,302 thousand tonnes, or a 15% increase from the same period of 2009, from the Company's stakes in Kazgermunai (KGM), CCEL and PetroKazakhstan Inc. (PKI).

In the first nine months of 2010 the Company produced 6,555 thousand tonnes (177kbopd) of oil at Uzenmunaigas and Embamunaigas production facilities, which is 193 thousand tonnes or 3% less than for the same period of last year. The decline in production was mainly caused by the failure to perform well service operations and timely oilfield equipment repairs amid a strike by Uzenmunaigas workers over the period from March 4 through March 18. Also during the period from June to September 2010 there was a number of emergency power cuts in the fields, caused by severe weather conditions.

Given the above reasons for falling behind, the Board of Directors has decided to adjust the 2010 production plan for Uzenmunaigas field from 6,302 thousand tonnes to 6,001 thousand tonnes.

As a result, the Company anticipates the annual volume of production at Uzenmunaigas and Embamunaigas production facilities to be 8,781 thousand tonnes (177kbopd) for 2010.

The Company's share in the production volumes from KGM, CCEL and PKI for the nine months of 2010 amounted to 3,391 thousand tonnes of crude oil (93kbopd).

According to preliminary data, during the first nine months of 2010 the Company supplied 6,496 thousand tonnes of crude oil (175kbopd), excluding the share in supply from KGM, CCEL and PKI. Of this amount, 5,156 thousand tonnes (139kbopd) were exported.

The Company's share in the sales volumes from KGM, CCEL and PKI was 3,802 thousand tonnes of crude oil[1] (105kbopd), including 2,682 thousand tonnes (74kbopd) supplied to export markets.

Notes to Editors

KMG EP is among the top three Kazakh oil and gas producers. The overall production in 2009 was 11.5mmt (an average of 232kbopd) of crude oil, including the Company's share in Kazgermunai and CCEL. The volume of proved and probable reserves (2P) of KMG EP as at the end of 2009 was 234mmt (1.7bn barrels); while including the share of reserves from associates and joint ventures, preliminary about 2.2 bn barrels. The Company's ordinary and preferred shares are listed on Kazakhstan Stock Exchange and the GDRs are listed on The London Stock Exchange. The Company raised over US$2bn in its IPO in September 2006. In December 2009 International rating agency Standard & Poor's assigned KMG EP "GAMMA-6" level of the corporate governance and in July 2010 confirmed the Company's "BB+" corporate credit rating.

For further details please contact us at:

«KMG EP». Public Relations (+7 7172 97 7600)

Daulet Zhumadil

E-mail: [email protected]

«KMG EP». Investor Relations (+7 7172 97 5433)

Asel Kaliyeva

E-mail: [email protected]

Pelham Bell Pottinger (+44 207 861 3147)

Elena Dobson

E-mail: 

[email protected]

Forward-looking statements

This document includes statements that are, or may be deemed to be, ''forward-looking statements''. These forward-looking statements can be identified by the use of forward-looking terminology including, but not limited to, the terms ''believes'', ''estimates'', ''anticipates'', ''expects'', ''intends'', ''may'', ''target'', ''will'', or ''should'' or, in each case, their negative or other variations or comparable terminology, or by discussions of strategy, plans, objectives, goals, future events or intentions. These forward-looking statements include all matters that are not historical facts. They include, but are not limited to, statements regarding the Company's intentions, beliefs and statements of current expectations concerning, amongst other things, the Company's results of operations, financial condition, liquidity, prospects, growth, potential acquisitions, strategies and as to the industries in which the Company operates. By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances that may or may not occur. Forward-looking statements are not guarantees of future performance and the actual results of the Company's operations, financial condition and liquidity and the development of the country and the industries in which the Company operates may differ materially from those described in, or suggested by, the forward-looking statements contained in this document. The Company does not intend, and does not assume any obligation, to update or revise any forward-looking statements or industry information set out in this document, whether as a result of new information, future events or otherwise. The Company does not make any representation, warranty or prediction that the results anticipated by such forward-looking statements will be achieved.