Zhaikmunai L.P. Reserve Report Announcement

Zhaikmunai L.P. (LSE: ZKM) (‘Zhaikmunai’), the oil and gas exploration, development and production enterprise, today announces the results of an independent reserves evaluation of its Chinarevskoye field in northwestern Kazakhstan as at 1 July 2008. The reserve report was carried out by the independent petroleum consultants Ryder Scott Company, L.P. (“Ryder Scott”).

Highlights 

• Proved plus probable gross reserves (2P) increased by 35% to 535 million barrels of oil equivalent (“mmboe”) (1 July 2007: 397mmboe)
• Possible gross reserves increase of 55% to 556mmboe (1 July 2007: 359mmboe)
• Proved plus probable plus possible (3P)gross reserves estimate now exceeds 1

billion boe, at 1,091mmboe (1 July 2007:756mmboe)

• Finding costs remain below US$1 per boe

Commenting on the 2008 Reserve Report, Kai Kessel, CEO, said:

“The reserve report underlines the huge potential of the Chinarevskoye field and validates our continued exclusive focus on this asset. Our 3P reserves have for the first time reached and risen above 1 billion barrels of oil equivalent, and finding costs for 2P reserves are significantly below $1 per BOE. During the next few weeks, Zhaikmunai will prepare a new business plan, taking the new 2P reserves into account, as a basis for our future drilling programme and facility design.” 

The Ryder Scott reserves report estimates that Zhaikmunai has the following gross reserves:

  Category                         1 July 2007  1 July 2008 

                                                    mmboe         mmboe       

Proved                                             137           133

Probable                                      260           402

Proved plus probable (2P)             397          535

Possible reserves                             59           556

Proved plus probable plus possible reserves (3P)  756           1,091

Based on successful implementation of Zhaikmunai’s 2007/08 exploration drilling programme, 2P reserves have increased by almost 35% in comparison with the previous year. There has also been a significant increase in possible reserves, which have increased by 55%, from 359 mmboe in 2007 to 556 mmboe in the period.

A slight decrease in proved reserves is mainly due to production during the past year as all new production wells have been drilled in the proved area of reserves. This has resulted in an increase in proved producing reserves of 41 per cent and an increase in proved non-producing reserves of 54 per cent compared with the prior year.

Of the reported 2P reserves, oil and condensate comprise 41 per cent (2007: 41%), gas comprises 44 per cent (2007: 44%) and LPG comprises the remaining 15 per cent (2007: 15%).

Gross recoverable 3P reserves as at 1 July 2008, totaling 1,090 mmboe, represented a 44% increase year on year, ( 1 July 2007: 756 mmboe), indicating that additional investments in drilling and facilities will be required to handle increased volumes.

Note:

Proved and probable oil and gas reserves are estimated quantities of commercially producible hydrocarbons which the existing geological, geophysical and engineering data show to be recoverable in future years from known reservoirs. The proved reserves reported by Ryder Scott, independent petroleum consultants, conform to the definition approved by the Society of Petroleum Engineers (“SPE”) and the World Petroleum Congress (“WPC”). The probable and possible reserves reported by Ryder Scott conform to definitions of probable and possible reserves approved by the SPE/WPC using the deterministic methodology.

Zhaikmunai’s management team will hold a conference all for analysts and investors to discuss this announcement at 3pm BST on Wednesday 24 September2008.

Dial in details for the conference call are provided below.

Participants International Dial In:              +44 (0) 1452 561 263

Conference ID:                                      65985061

For further information please visit our website www.zhaikmunai.com or contact:

Zhaikmunai
info@zhaikmunai.com

Brunswick
Michael Harrison, Carole Cable
+44 20 7404 5959

About Zhaikmunai 

Zhaikmunai L.P. is an oil and gas exploration, development and production enterprise quoted on the London Stock Exchange (Ticker symbol: ZKM). Its principal producing asset is the Chinarevskoye Field located in Northwestern Kazakhstan.

Zhaikmunai LLP, a wholly-owned Kazakhstan subsidiary of Zhaikmunai LP, holds a 100% interest in, and is the operator under, the production sharing agreement for the Chinarevskoye Field.

Forward-Looking Statements:

Some of the statements in this document are forward-looking. Forward-looking statements include statements regarding the intent, belief and current expectations of the Partnership or its officers with respect to various matters. When used in this document, the words “expects,” “believes,” “anticipates,” “plans,” “may,” “will,” “should” and similar expressions, and the negatives thereof, are intended to identify forward-looking statements. Such statements are not promises or guarantees, and are subject to risks and uncertainties that could cause actual outcomes to differ materially from those suggested by any such statements.