#5 October 2011

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By the decision of shareholders of Zhemchuzhina project, under proposal of Shell Kazakhstan Development, a shareholder of the joint operating company, Aslan Shapabayev was appointed to the post of general director of Caspy Meruerty I^perating Company. Partners in the project have supported the initiative to appoint a representative of JSC MNC E^a`zMunayTeniz to the supervising post considering that the proposed nominee is well familiar to the participants. Prior to his appointment, since April 2008 A. Shapabayev held a post of the companys deputy general director. The former general director I`a`rcusa` A`ntonini has left the project Zhemchuzhina in connection with the transfer to Shells other important direction.

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JSC KazMunayGas Exploration Production

JSC KazMunayGas Exploration Production (KMG EP) has completed a deal on acquisition from its parent company, the national holding KazMunayGas, a 100% subsoil use right within four contracts for exploration of hydrocarbon raw materials in Kazakhstan. As it is informed in KMGs press-release, the talk is about Blocks Temir and O`a*resken (Aktyubinsk region), Karaton-Sarkamys (Atyrau region) and the territory adjoining to the fields Uzen and E^a`ramandybas (Mangistau region). The total cost of acquisition was $43.8 million. It includes

the price of four contracts worth $40 million and valuation adjustment due to expenditures incurred by KMG on financing the working program on Block Teresken prior to the deal completion in 2011 $3.8 million. Financing was carried out on the account of KMG EPs own means.

Earlier, this deal was approved by the board of directors of KMG EP and the council of directors of the national company. Also, all necessary permits of regulatory bodies were received. As it was informed, KMG EP and KazMunayGas reached an agreement on the purchase and sale of four mentioned blocks in April of this year. Geological resources of all blocks are estimated approximately at 1.5 billion barrels in oil equivalent. The term of the contracts on the area adjoining to the fields Uzen and Karamandybas and blocks Karaton-Sarkamys and O`a*mir is 6 years since 2010 with the right of prolongation up to 2019; and on O`a*resken block 6 years since 2006 with the right of prolongation till 2015. Closeness of blocks Temir and O`a*resken to the assets of Kazakhoil Aktobe LLP and Kazakhturkmunai, of the territory adjoining to the fields Uzen and Karamandybas to the zone of operation of Ozenmunaigas and of block Karaton-Sarkamys to the area of Embamunaigas assumes the use of existing infrastructure of these enterprises and optimisation of capital and operational expenses.

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Karachaganak Petroleum Operating

AKSAI, Western Kazakhstan Oblast, 14 June 2011 Karachaganak Petroleum Operating B.V. (KPO) announced today that it has successfully put into operation an additional liquid stabilization train at the Karachaganak Processing Complex (KPC).

The start-up of the new oil processing facility at KPC, which adds on the already existing three trains, will enable the stabilization capacity of the plant to increase by 2.57 million tonnes of condensate per year.

KPC is the main processing unit at the Karachaganak Field, preparing oil to be exported via Atyrau for sale on international markets. The plant also provides fuel gas supply for the fields power station and sweet gas supply to the local market.

The total volume of investments by KPO to construct the additional train (Train D) has exceeded $1 billion. The major works were conducted by 14 Kazakhstani contractors employing over 2,900 people with $650 million spent in the Republic of Kazakhstan.

Speaking on completion of the project Giuseppe Pasi, KPO General Director, said: We start up the new facility, once again demonstrating the commitment of the Karachaganak Venture to continue investing into the development of the Karachaganak Field.

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Kazakhmys Petroleum

The deal was concluded on the sale by Kazakhmys Plc of its oil and gas division Kazakhmys Petroleum which was engaged in development of the oil field East kzhar in western Kazakhstan. As is said in the message of Kazakhmys, a $100 million deal is subject to approval by regulating bodies. Under the deal's conditions, the buyer, whom the copper company does not name, will pay a potential royalty at a rate of $476 million depending on the future gain from the sale of oil. According to information, the board of directors of Kazakhmys Plc took a decision to sell its oil and gas business "with the aim to concentrate on its primary activity". As it was informed, in March 2007 Kazakhmys Plc and a private firm Total Commerce Solutions Ltd signed an agreement on the purchase and sale of Dostan-Temir LLP, owner of block East kzhar. The group then declared that the total amount of assets of this company is estimated at $100 000.

East kzhar presents a research block with the area of 602 square kilometres located to the south of ktobe, in the region of the eastern border of Pre-Caspian lowland. Numerous 2D and 3D seismic survey and other exploration activity were conducted in the area of this block, including drilling of exploration wells. After the purchase of asset, Kazakhmys Plc formed a team to run this project and announced the search of a partner having experience in the oil industry. The leadership of the copper group named the deal on acquisition of the oil and gas block a first step in implementing the strategy of diversification of its business. According to Kazakhmys, the exploration licence for block East kzhar, expired in May 2011, was prolonged by two years on the former conditions.

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American Fluor Corporation has been chosen as a contractor under the expansion project for the export oil pipeline ngiz - Novorossiysk of Caspian Pipeline Consortium (CPC) up to 67 million tons of oil annually. According to the press-release of Fluor placed on its website, Fluor Corporation concluded a contract with one of CPC's private shareholders - American Chevron - to maintain designing of the sea terminal and supervising control and management of pipeline's expansion project (SCADA). The project is planned to complete in late 2014. As it is marked in the message, Fluor has already conducted similar works under building of the functioning oil pipeline CPC.

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Yokogawa Electric Kazakhstan

On June 10, 2011, an official opening ceremony was held in the city of Atyrau of the first service technical center of Yokogawa Electric Corporation in the Republic of Kazakhstan which was attended by the representatives of the leading enterprises in the oil and gas and processing industries, as well as the large engineering companies. The service center of Yokogawa Electric Kazakhstan LLP offers a wide spectrum of training courses called to help customers to maximally use all opportunities of equipment and software proposed by Yokogawa. The training center is equipped with modern demonstration equipment with the instructors having a lengthy operational experience. Along with training of the customers' employees, the company's technical center is engaged also in technical consultation of specialists, as well as in service support and after-guarantee service.

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Since July 1, Abai Kuvanov was appointed to the post of general director of the holding enterprise ktaunefteservice LLP. He was born in 1960 and earlier headed the production department Zhetibaimunaigas of JSC Mangistaumunaigas. As it was informed earlier, MG has acquired a 100 % interest in the charter capital of Aktaunefteservice LLP by paying $334 million for the purchase. Activity of ktaunefteservice is connected with rendering of oil services to JSC Mangistaumunaigas.

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On September 6, a welding ceremony of the first joint of the linear part of the Beineu-Bozoi-Shymkent gas pipeline was held in the town of Turkestan, South Kazakhstan region.

The first deputy Prime Minister of the R Umirzak Zhukeyev, vice-chairman of the National Development and Reform Commission, chairman of State Energy Department of the People's Republic of China Liu Tienan, Minister of Oil and Gas of the R Sauat Mynbayev, South Kazakhstan Region Akim Askar Myrzakhmetov, chairman of the board of JSC NC KazMunayGas Kairgeldy Kabyldin, and vice-president of CNPC Wang Dongjin attended the event.

S. Mynbayev has started the welding of the first joint of the gas pipeline's linear part after which the event's participants have left their memorable signatures on the gas pipeline. Also, they took part in the ceremony of laying a memorable capsule for the construction of the gas distribution station.

JSC NC KazMunayGas runs the construction project for the gas pipeline Beineu-Bozoi-Shymkent within the state program for forced industrial and innovation development of the Republic of Kazakhstan for 2010-2014.

The Beineu-Bozoi-Shymkent gas pipeline 1 475 km in length will pass the territories of the Mangistau, Aktyubinsk, Kyzylorda and South Kazakhstan regions. During construction, it is planned to involve about 3500 Kazakhstan specialists with additional 500 jobs to be created during the pipeline's operation. The population which will get access to gas supply amounts to over 1.5 million (the tenth part of the republic's population).

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