KBM: Granted 15 Year Extension on the Karazhanbas Oilfield

KBM has been granted an extension of its subsurface use contract to explore, develop, produce and sell oil from the Karazhanbas oilfield for a further period of 15 years commencing from its original expiry date in 2020 by the relevant governmental and regulatory authorities in Kazakhstan.

Extension of Subsurface Use Contract

The board of directors of CITIC Resources Holdings Limited is pleased to inform shareholders of the Company and potential investors that JSC Karazhanbasmunai (‘KBM’) has been granted an extension of its subsurface use contract to explore, develop, produce and sell oil from the Karazhanbas oil and gas field in Mangistau oblast, Kazakhstan for a further period of 15 years commencing from its original expiry date in 2020 by the relevant governmental and regulatory authorities in Kazakhstan.

Information relating to KBM and the Karazhanbas oilfield

KBM is a joint stock company incorporated in Kazakhstan jointly controlled between CITIC and KazMunaiGas Exploration Production. The Group and KMG EP each own 50% of the voting shares of KBM (representing 47.3% of the total issued shares of KBM).

KBM is engaged in the development, production and sale of oil and holds the right to explore, develop, produce and sell oil from the Karazhanbas oilfield.

As at 31 December 2014, the Karazhanbas oilfield had estimated proved oil reserves of 250.3 million barrels as determined in accordance with the standards of the Petroleum Resources Management System. Production from the Karazhanbas oilfield is currently about 39,000 barrels per day and oil produced from the Karazhanbas oilfield is typically 19 degrees API.