KMG EP approved the budget for 2015

PRESS RELEASE

KMG EP's Board of Directors approved the budget for 2015

Astana, December 10, 2014. JSC KazMunaiGas Exploration Production ("KMG EP" or the "Company") held its regular Board of Directors ("the Board") meeting on December 8, 2014. At the meeting the Board approved the budget for 2015 which assumes a Brent oil price of US$70 per barrel.

Planned production in 2015 is expected to be 5.4 million tonnes (109 kbopd) from JCS OzenMunaiGas (OMG) and 2.8 million tonnes (57 kbopd) from JCS EmbaMunaiGas (EMG). Thus, the total planned production volume in 2015 from OMG and EMG is expected to be 8.2 million tonnes (166 kbopd) or 1% more than planned production in 2014.

The Company's share in the planned production of Kazgermunai (KGM), CCEL (CCEL) and PetroKazakhstan Inc. (PKI) in 2015 is estimated to be 4.0 million tonnes (81 kbopd) or 3% less than planned production in 2014 due to a natural decline of production at PKI.

The Company expects the annual volume of oil supply to the domestic market in 2015 to be 3.0 million tonnes (59 kbopd) which will be supplied to Atyrau and Pavlodar refineries. An additional 100 thousand tonnes of oil will be processed at the Atyrau refinery for the Company's own use. The Company's share in the planned volume of oil supply to the domestic market in 2015 from KGM, CCEL and PKI is 2.2 million tonnes (45 kbopd) or approximately 55% of total sales from these companies.

As the Company has not received approved schedule for deliveries to Russia for 2015, shipments to Russia are not reflected in the 2015 budget.

Capital expenditure in 2015 is expected to be 115 bn Tenge (US$621m), 14% less than planned expenditure in 2015 according to the previous year business plan. The lower capital expenditure will not impact on field recovery and will stem from reduced spending on infrastructure projects and the postponement of some longer-term projects from the Company's modernisation programme.

Notes to editors

KMG EP is among the top three Kazakh oil and gas producers. The overall production in 2013 was 12.4 million tonnes (an average of 251 kbopd) of crude oil, including the Company's share in Kazgermunai, CCEL and PKI. The Company's total consolidated volume of proved and probable reserves including shares in the associates, as at the end of 2013 was 200 million tonnes (1.5 bn bbl), out of which 148.8 million tonnes (1.1 bn bbl) relates to Ozenmunaigas, Embamunaigas, and UOG (Rozhkovskoye field, Fyodorovskiy block). The Company's shares are listed on the 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.

For further details please contact us at:

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

Asel Kaliyeva

e-mail: [email protected]

KMG EP. Public Relations (+7 7172 97 79 08)

Elena Pak

e-mail: [email protected]

Brunswick Group (+44 207 404 5959)

Andrew Mitchell

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.