Canton update

7 January 2016

Hydrodec Group plc

("Hydrodec" or the "Company")

Canton update

Hydrodec Group plc (AIM: HYR), the cleantech industrial oil re-refining group, is pleased to announce that the transformer oil produced from its Canton re-refinery has achieved '500hr' oil status, certifying the oil to be high quality transformer oil and a prerequisite to accessing the larger power transformer market. With all six trains at Canton now in service, the Company is also pleased to confirm the achievement of an all-time daily production record from the Canton plant of over 94,000 litres with all six trains operative at the end of December 2015. The Canton plant produced 10.5 million litres of processed oil in 2015 in line with previously stated projections.

Chris Ellis, Acting Chief Executive, commented: "Achieving '500hr' oil status and these levels of production at the Canton plant are significant milestones and provide a solid base from which to deliver our 2016 production and sales targets for transformer oil into the U.S. market. This is the first step in management's focus across the Group on execution, delivering improved operational performance and efficiencies and driving the Company to a profitable 2016."

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Notes to Editors:

Hydrodec's technology is a proven, highly efficient, oil re-refining and chemical process initially targeted at the multi-billion US$ market for transformer oil used by the world's electricity industry. Spent oil is currently processed at two commercial plants with distinct competitive advantage delivered through very high recoveries (near 100%), producing 'as new' high quality oils at competitive cost and without environmentally harmful emissions. The process also completely eliminates PCBs, a toxic additive banned under international regulations. Hydrodec's plants are located at Canton, Ohio, US and Young, New South Wales, Australia. In 2013, Hydrodec acquired the business and assets of OSS Group, the UK's largest collector, consolidator and processor of used lubricant oil and seller of processed fuel oil, with a national network of oil storage and transfer stations. Used oil is converted into processed fuel oil at OSS's plant at Stourport and principally sold on to the UK quarry and power industry. In April 2015, Hydrodec further acquired the business and assets of Eco Oil, a leading UK waste oil collector and supplier of recycled industrial fuel oil into the power and road stone industries. It is also one of four significant providers of waste management services to the marine industry in the UK, specifically oily-water slops or marine pollutant (MARPOL). In line with our stated intention to develop a base oil re-refinery in the UK, we have an exclusive licence agreement with California-based Chemical Engineering Partners (CEP) to develop the CEP wiped-film evaporation and hydrogenation technology in the UK as well as the basic engineering for a 75 million litre per annum capacity base oil re-refinery.

Hydrodec's shares are listed on the AIM Market of the London Stock Exchange. For further information, please visit www.hydrodec.com.