Joint Venture with Oil and Gas Management Services Group

18 June 2013 Cadogan Petroleum plc ("Cadogan" or "the Group") Cadogan Announces Joint Venture with Oil and Gas Management Services Group Cadogan is pleased to announce that it has today signed a non-bindingMemorandum of Understanding ("MoU") and a Secured Loan Agreement (the "Loan")with Oil and Gas Management Services Limited ("OAGSG") (www.oagsg.com). OAGSG, which operates the largest Oil Country Tubular Goods (OCTG) business inKurdistan and runs a complete mill to well service, has been operatingsuccessfully since 2008. It provides services to a blue-chip client list, whichincludes Tenaris, Chevron, Exxon and other major operators. It also providesmanagement and consultancy services in the region. Pursuant to the MoU OAGSG will assist Cadogan in developing a presence in theKurdistan region, while the parties will apply their respective resources todeveloping their existing services businesses in Ukraine and Kurdistan. Theparties will commence negotiating formal, binding terms which will includegranting Cadogan an option to purchase up to 51% of the share capital of OAGSGwithin 18 months at a fair market value, to be determined by the parties at therelevant time. Cadogan will make a further announcement as and when bindingterms have been executed. In conjunction with the MoU Cadogan has agreed to lend OAGSG up to US$3m on afully secured basis against receivables due to OAGSG, subject to a maximum Loanto Value of 75%. The term of the Loan is 24 months and interest is 15% p.a.,payable on drawdown. The funds will be used to enable OAGSG to expand itsexisting operations in Kurdistan, purchase new equipment and further capitaliseon growth in the industry in the region. The Loan contains standard events ofdefault. Amounts loaned will be repaid as funds are received by OAGSG on thedue receivables and to the extent any amounts still remain outstanding, repaidin full after 24 months. Bertrand des Pallieres, CEO of Cadogan, commented: "Cadogan has already seenpositive returns from its limited investment in resources in oilfield servicesin Ukraine. For some time now we have been assessing options for acceleratinggrowth in this developing business area whilst at the same time seeking toexpand our global presence through the targeted use of funds. We see OAGSG,with its premium client list and operational expertise, as a perfect fit forour expansion plans and are excited about the potential new horizons for ourbusiness." Cadogan's interests in oilfield services in Ukraine include agreements withMedes on the provision of mud treatment services and an Exclusive CooperationAgreement with AVA (Newpark Group) on drilling fluids services. Enquiries to: Cadogan Petroleum Plc +380 44 584 4979 Bertrand des Pallieres Chief Executive Officer Cantor Fitzgerald Europe +44 (0) 20 7894 7000 David Porter Richard Redmayne Bankside Consultants +44 (0) 207 367 8888

Simon Rothschild