PARAGUAY UPDATE

PRESIDENT ENERGY PLC

("President" or "the Company")

PARAGUAY UPDATE

Highlights

Summary

President's 2014 drilling campaign marks a huge achievement, having unequivocally demonstrated the presence of previously unknown Paleozoic hydrocarbon bearing formations in the Pirity Basin of the Paraguayan Chaco.

This is a critical first step in value creation for President shareholders, the government of Paraguay and other stakeholders.

President considers it has discovered two separate reservoirs (Santa Rosa and Icla) which, when combined with the source rock evidence at Jacaranda, substantially de-risks its Paraguayan assets.

The majority of the Paleozoic prospectivity in President's operated acreage of 34,000 km2 lies in the Hernandarias Concession (18,507 km2) where the Santa Rosa target interval can be reached at much shallower depths, improving reservoir porosities, much enhancing the liquids fraction in the overall hydrocarbon mix and thereby benefiting from materially improved economics. The key prospect (Boqueron) contains three target zones and has potential for > 250 MMb liquids in the Devonian and Silurian.

The Icla discovery as defined by logs at Lapacho needs a definitive flow test to establish commercial flow rates. However, there is an additional thickness of Icla Formation in the Jacaranda prospect and management estimates a thickness in excess of 50m for the Icla pay zones with 20 MMboe mean Prospective Resources at a high chance of success. The majority of the preserved Icla Formation and prospectivity also lies in the Hernandarias Concession at shallower depths than in Pirity.

In addition, President has previously delineated a Cretaceous play fairway in the Pirity Concession as a direct extension of the proved Palmar Largo oilfield trend in adjacent Argentina, including the drill-ready Tapir prospect. The Cretaceous play fairway in Paraguay has been described in the RPS Independent Audit Report of Prospective Resources dated 23rd January 2014 and holds potential for 350 MMbbl light oil.

Peter Levine, Chairman, commented:

"Our 2014 drilling campaign has been a basin opening success of which we are very proud, despite the challenges faced in frontier drilling with no well control, no in country infrastructure and in a remote location with all the concomitant major logistic aspects to contend with on an almost daily basis. The giant Lapacho structure has been shown by drilling and logging to contain hydrocarbon bearing formations in both the Silurian Santa Rosa and Devonian Icla Formations. Hydrocarbon volumes could be very large and our estimate is that the overall President acreage position of 34,000 km holds 1 - 4 billion barrels oil equivalent gross Prospective Resources. Hydrocarbon flow testing has been hampered by mechanical failures due to poor hole conditions but has confirmed the presence of mobile gas condensate in the Santa Rosa Formation. With the Icla test not being valid a re-engineered well design and re-drill of the Lapacho x-1 well will be required to establish sustained commercial flow rates. However, I am confident that President has established the presence of a large new resource base, and by applying the increased learnings and understanding gained so far, we will move forward to plan the forward drilling program to unlock full basin potential."

President (64% WI and Operator) provides an update on testing of the Silurian Santa Rosa and Devonian Icla reservoirs in the Lapacho well. For the Santa Rosa, the difficult hole conditions experienced during the drilling of the well had prevented a liner being run in the 6" hole and an open hole test was performed. This was followed by a cased hole test of the Icla.

The Santa Rosa Test

The test was conducted with the tubing tailpipe just inside the 7" casing at 4020m and drilling mud in the open hole (well TD at 4543m). The tubing was circulated to diesel to create the underbalance and well was opened up. The well initiated flow at a rate of 107 barrels per day but the test had to be prematurely terminated after a cumulative production of only 14.2 barrels of fluid returns due to a serious mechanical failure in the bottom of the test string that prevented inflow.

After retrieving the test string and confirming the blockage, a check trip was performed and elevated gas readings of greater than 20% total gas (including C1-C5) were encountered throughout the cased and open hole sections until the bit held up due to hole conditions. This demonstrates that the well flowed gas and condensate, a view further reinforced by the significant gas shows through the open hole drilling operations, as previously announced.

Given the deteriorating hole conditions and high risk of hole collapse under an extended testing program, it has been decided to not attempt to repeat the test but to suspend the open hole section for later re-drilling by side tracking, learning from the downhole conditions experienced, and running a liner.

Management View of the Santa Rosa Test

In management's view the Lapacho x-1 drilling and test has demonstrated the following with respect to the Santa Rosa Formation:

· That gas condensate sands at a depth of 4125-4543m flow even with suboptimal conditions of an open hole test, which in this case was shortened and technically impacted. Given optimal drilling and completion techniques, the huge scale of the gas condensate resource and the wide range of depths and settings, management is now of the view that Santa Rosa can be commercialised.

· 58m of clean sandstones penetrated and based upon seismic, significant additionalsandstone, some 30m+, expected in the undrilled target interval section below currentTD, indicating a total thickness of more than 80m at this location.

· That the sands flowed gas and condensate and based on the C1-C5 ratios and Bolivian field analogues the condensate ratio is expected to be in the range of 20-40 bbls/MMscf.

· The three way dip closure at Lapacho is part of a much larger regional sub-crop trap, as described in the RPS Independent Audit Report of Prospective Resources, dated 12th June 2014, which has potential for 5TCF gross prospective gas resources plus associated condensate. Assuming a total of 80m of stacked sand pay zones and the figures in the RPS Independent Audit Report, then the Lapacho three way dip closure contains gross prospective resources of approximately 1 TCF gas plus associated condensate. Lapacho x-1 well has therefore confirmed the presence of a very significant accumulation of hydrocarbons in the range from 1 TCF to 5 TCF plus associated condensate in the greater Lapacho area.

· Some 32 large Paleozoic structures and leads have been identified to date in President'sacreage and management estimates that President's Paraguayan Paleozoic operated acreage could contain between 1 and 4 billion barrels of gross unrisked prospective resources on an oil equivalent basis. The depth of the Santa Rosa in these prospects varies between 2000-5000m, with the prospects in the Pirity and Demattei Concessions lying deeper at 3500-5000m, and in Hernandarias Concession lying shallower and at a much more accessible and economic level at 2000-4000m.

The Icla Test

The test was performed over the two oil bearing sands at 3926-3953 m as previously announced on 20th October 2014. The operation was carried out using a Schlumberger drill stem test string and underbalanced 4.5" TCP perforation guns. During two flow periods a total of 110 barrels of gas cut formation water with average salinity of 80,000ppm with no traces of oil were obtained. The water salinity is characteristic of the overlying Cretaceous Pirgua Formation above 3915m and not characteristic of the lower salinity Icla Formation (35,000-50,000ppm).

Management View of the Icla Test

The Icla test is not a valid test of the Devonian hydrocarbon bearing interval, previously evaluated using a full suite of wireline logs, complemented by hydrocarbon bleeding side wall cores. The cementation of the 7" liner was executed successfully but the cement bond log (CBL-VDL) shows poor quality cement over the Cretaceous Pirgua Formation which immediately overlies the Icla Formation. Although the cement bond log shows good cement over the Icla perforation interval, it is concluded that communication exists with the overlying highly permeable Cretaceous Pirgua sands. Given the cost of mobilising equipment for a squeeze job and generally low chance of success of these operations, the interval was suspended for a future re-entry.

Lapacho x-1 drilling and logging has demonstrated the following with respect to the Icla Formation:

· Combined net sand thickness of 20m, with an average porosity of 6% and 60% oil saturation (using a water salinity of 50,000ppm).

· Logging shows the extensive development of conductive natural fractures. Side wall cores were bleeding live oil and hydrocarbon type appears to be light oil and condensate.

· Management estimates the size of the Icla discovery at discrete fault block at Lapacho has a gross mean Prospective Resource of 10 MMboe, with considerable follow-on opportunity.

Next Steps

Given the immense resource potential of the Company's basin-wide acreage position, management will engage in discussions with industry partners to unlock the full value of the opportunity set. Line clearing for seismic in Hernandarias has been completed, and planning for a new round of seismic acquisition is underway. The QG1 rig will be released with a view to resume the drilling program on high graded prospects in the summer of 2015. The Company's cash flow from Argentina and Louisiana, when combined with the loan facility, provides financial flexibility.

Dr. Richard Hubbard, PhD Geology Stanford University, with 40 years of experience in the oil and gas sector, as President Chief Operating Officer, meets the criteria of qualified persons under the AIM guidance note for mining and oil and gas companies, has reviewed and approved the technical information contained in this announcement.

Contact:

President Energy PLC

Peter Levine, Chairman +44 (0) 207 016 7950

John Hamilton, CEO +44 (0) 207 016 7950

Ben Wilkinson, Finance Director +44 (0) 207 016 7950

RBC Capital Markets

Jeremy Low, Matthew Coakes, Daniel Conti +44 (0) 207 653 4000

Canaccord Genuity Limited

Tim Redfern, Henry Fitzgerald-O'Connor +44 (0) 207 523 8000

Bell Pottinger

Gavin Davis, Henry Lerwill +44 (0) 207 861 3232