Gas & Condensate Production Increased

18 December 2015

Volga Gas plc

("Volga Gas", the "Company" or the "Group")

GAS & CONDENSATE PRODUCTION INCREASED

Volga Gas plc, the oil and gas exploration and production group operating in the Volga Region of Russia, is pleased to announce that combined production of gas from its Vostochny Makarovskoye ("VM") and Dobrinskoye fields has reached its short term target of 750,000 m3 per day. Including associated condensate of approximately 1,400 barrels per day, the total production rate is equivalent to 5,700 barrels of oil equivalent per day ("boepd").

As announced on 14 December 2015, the VM#4 well, in which the Group drilled a successful sidetrack earlier in 2015, was recently put on production. Following a short build-up, by 16 December 2015, the combined output from four wells, VM#1, VM#2, VM#4 and Dobrinskoye #22 produced 755,000 m3 per day of sales gas from the Dobrinskoye Gas Plant.

Andrey Zozulya, Chief Executive of Volga Gas, commented:

"We are delighted to have achieved the important production target with the new well on the VM field. With the completion of the VM#3 well, which is already drilled but awaiting tie-back, the Group is well placed to reach an eventual plateau of 1 million cubic metres of daily gas production from the VM and Dobrinskoye fields."

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Editors' notes:

Volga Gas is an independent oil and gas exploration and production company operating in the Volga region of Russia. The company has 100% interests in its four licence areas.

The information contained in this announcement has been reviewed and verified by Mr. Andrey Zozulya, Director and Chief Executive Officer of Volga Gas plc, for the purposes of the Guidance Note for Mining, Oil and Gas companies issued by the London Stock Exchange in June 2009. Mr. Andrey Zozulya holds a degree in Geophysics and Engineering from the Groznensky Oil & Gas Institute and is a member of the Society of Petroleum Engineers.