KMG EP approves a preferred share buyback program

PRESS RELEASE

KMG EP approves a preferred shares buyback programme

Astana , 26 February 2010. KazMunaiGas Exploration Production (the "Company") announces that a preferred shares buyback programme has been approved by the Company's Board of Directors.

Following the listing on the Kazakhstan Stock Exchange ("KASE"), the Company intends to buy back up to 4,136,107 shares (i.e. up to 100 per cent of the total number of the issued preferred shares of the Company) for up to 10 per cent of the Company's equity capital as at the date of the Board decision, minus the costs of the Company's ordinary share and global depository receipt buyback programme.

The Company will carry out the preferred shares buyback programme on KASE. It is anticipated that the share buyback will be carried out through a sequence of separate 30-day specialized trades in accordance with KASE requirements. It is expected that the buyback programme will be completed on or before 31 December 2011.

A further announcement will be made following the admission of the preferred shares of the Company to circulation on KASE. The Company will also make announcements before each specialized trade, as well as announcements after each specialized trade informing of the terms and results of such trade.

The listing and the buyback programme is intended to allow shareholders greater transparency and liquidity. The majority of preferred shares are currently distributed among more than 30 000 individual shareholders, including present and former employees of KMG EP and their families.

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 total volume of proved and probable reserves, as at the end of 2008, was 241mmt (1.8bn bbl), excluding the relevant proportion of reserves at Kazgermunai and CCEL; including the share of reserves from Kazgermunai and CCEL the 2P reserves are over 2.1 bn barrels. The Company's 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 July 2009 International rating agency Standard & Poor's (S&P) confirmed KMG EP's "BB+" corporate credit rating and assigned the Company "GAMMA-6" rate.

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 PR (+44207 337 15 17)

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.