SOURCE: Zhaikmunai LP

April 22, 2013 02:10 ET

Zhaikmunai LP - Terms of GDR Buy-Back Programme

AMSTERDAM, THE NETHERLANDS--(Marketwired - Apr 22, 2013) -


Terms of GDR Buy-Back Programme to Drive Shareholder Value

Amsterdam, 22 April 2013. Zhaikmunai L.P ("Zhaikmunai" or the
"Partnership") is pleased to announce the terms of a long-term GDR
Buy-Back programme. The programme will commence following the release
of Zhaikmunai's unaudited consolidated accounts for the first quarter
ended 31st March 2013 expected in the week of May 13, 2013.

Zhaikmunai, a leading independent oil and gas business engaged in the
production, development and exploration of oil and gas in the former
CIS, is pleased to announce that it is commencing a Buy-Back Programme
with the intention to purchase up to US$ 50 million of its GDRs (the
"Buy-Back Programme").

The Buy-Back Programme has been approved by the Board of Directors of
the General Partner (the "Board") in recognition of the Partnership's
strong financial position and significant cash generating abilities.
In addition, the Board believes that acquiring GDRs at current levels,
which are at a significant discount to fair value, represents an
excellent value proposition for Zhaikmunai security holders as a
whole.

Zhaikmunai generates significant free cash flow and has a robust
balance sheet and excellent credit metrics. As at 31 December 2012,
the Partnership had a cash and cash equivalent position of US$ 251
million and a net debt of less than 1x LTM EBITDA. As a result of this
strong financial position, Zhaikmunai will allocate up to 10 percent of
EBITDA on a quarterly basis to buying back GDRs.

As previously announced, on 28 March 2013 Zhaikmunai's limited partners
approved by special resolution amendments to Zhaikmunai's Limited
Partnership Agreement to allow for the implementation of the Buy-Back
Programme and authorised the Board to implement a Buy-Back Programme
for the period until the conclusion of the 2014 annual general meeting
of limited partners.

The Buy-Back Programme is expected to initially continue for
approximately 12 months and to involve maximum consideration of US$ 50
million. Thereafter, proposed annual extensions to the duration of the
Buy-Back Programme may be submitted by the Board to the limited
partners for approval.

Zhaikmunai remains committed to investment in the Partnership's growth
and expects to generate sufficient revenue to drive future investment
and deliver value for security holders. This investment in growth will
be pursued in tandem with a balanced approach to a return of excess
liquidity to security holders. In September 2012 the Partnership
announced the adoption of a dividend policy and made its inaugural cash
distribution. The Buy-Back Programme represents a complementary
component of this commitment to driving returns to security holders and
the Board is confident that the implementation of the Buy-Back
Programme will not impact the Partnership's ability to implement
organic growth initiatives or its flexibility to drive further growth
through other value-accretive, focused initiatives.

The objective of the Buy-Back Programme is to reduce the number of
issued GDRs of the Partnership and repurchased GDRs may also be used to
meet obligations arising from Zhaikmunai's employee share option plan.

Purchases of GDRs pursuant to the Buy-Back Programme will be conducted
by Zhaikmunai's brokers, Deutsche Bank AG, London Branch ("Deutsche
Bank") and VTB Capital plc ("VTB Capital"), acting on its behalf in
accordance with the requirements of the FCA's Code of Market Conduct in
respect of buy-backs of listed securities. The Buy-Back Programme will
be in place until the maximum consideration of US$ 50 million has been
paid but, in any event, no later than 31st December 2014 unless
extended with the approval of Zhaikmunai's limited partners. The
Buy-Back Programme may be varied or terminated at any time at the
Board's sole discretion. Zhaikmunai will provide periodic updates as
to the implementation of the Buy-Back Programme in a transparent manner
and in accordance with the requirements of the EU Buy-Back and
Stabilisation Regulation.

Mr. Frank Monstrey, Chairman of Zhaikmunai, commented:
"Zhaikmunai continues to make significant progress, delivering on its
operational, strategic and financial milestones and de-risking both the
current position and the future. The Board remains highly confident in
Zhaikmunai's financial position, cash generation and growth prospects
and does not believe that the recent GDR price performance reflects
Zhaikmunai's underlying prospects. Our financial position provides us
with a platform from which we can simultaneously pursue the next stage
of our development and look for all viable means to deliver value for
our equity holders. In this context, the proposed acquisition of the
GDRs represents a highly attractive investment opportunity in the best
interests of the Partnership and its equity holders."


Further information

For further information please visit  www.zhaikmunai.com 

Further enquiries

Zhaikmunai LP - Investor Relations
Bruno G. Meere
Kirsty Hamilton-Smith
 investor_relations@zhaikmunai.com        + 31 20 737 2288

Deutsche Bank                           + 44 (0) 207 545 8000
Ben Lawrence
JM Hafner
Rob Abbott

VTB Capital plc                         + 44 (0) 203 334 8000
Alexander Metherell
Marcus Brown
Giles Coffey

Pelham Bell Pottinger                   + 44 (0) 207 861 3232
Philip Dennis
Elena Dobson

About Zhaikmunai

Zhaikmunai is an independent oil and gas enterprise currently engaging
in the production, development and exploration of oil and gas in
north-western Kazakhstan. Its Global Depositary Receipts (GDRs) are
listed on the London Stock Exchange (Ticker symbol: ZKM). Zhaikmunai's
principal producing asset is the Chinarevskoye field, in which it holds
a 100% interest and is the operator, through its wholly-owned
subsidiary Zhaikmunai LLP. In addition, Zhaikmunai holds a 100%
interest in and is the operator of the Rostoshinskoye, Darinskoye and
Yuzhno-Gremyachenskoye oil and gas fields. Located in the pre-Caspian
basin to the north-west of Uralsk, these exploration and development
fields are approximately 60 and 120 kilometres respectively from 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.

Deutsche Bank

Deutsche Bank AG is authorised under German Banking Law (competent
authority: BaFin - Federal Financial Supervisory Authority) and
authorised and subject to limited regulation by the Financial Conduct
Authority (the "FCA"). Details about the extent of Deutsche Bank AG's
authorisation and regulation by the FCA are available on request.

VTB Capital

VTB Capital Plc is authorised by the Prudential Regulation Authority
and regulated by the Financial Conduct Authority and the Prudential
Regulation Authority.



                    This information is provided by RNS
          The company news service from the London Stock Exchange

END

Contact Information