Zhaikmunai LP announces Final Results

ISLE OF MAN, UK--(Marketwire - Mar 15, 2012) -

Zhaikmunai L.P.

(the "Partnership")


ZHAIKMUNAI DOUBLES EBITDA TO CONCLUDE

ANOTHER RECORD YEAR IN 2011


Zhaikmunai LP (LSE: ZKM), the oil and gas exploration and production
enterprise with assets in north-western Kazakhstan today communicates
its financial results for the year ended 31st December 2011 as well as
a 2012 production update including its Gas Treatment Facility (GTF).


KEY HIGHLIGHTS


* Total production (crude oil and GTF products) increase of 69.7%
to 4,802,561 boe;

* Revenue increase of 68.9% to USD300.8 million;

* EBITDA increase of 99.8% to USD197.4 million;

* More than three-fold increase in Net Income to USD81.6million
(+256.4%);

* Strong balance sheet with USD128.5 million in cash;

* Handover of the Gas Treatment Facility (GTF) completed in
December 2011;

* Over 10 months sales of on-spec products (crude oil, stabilised
condensate, LPG and dry gas) delivered to offtakers;

* Zhaikmunai enters its final stage of production ramp-up to full
capacity of 48,000 boepd with Well # 401 coming on-line.



Frank Monstrey, Chairman of Zhaikmunai, commented:
"Zhaikmunai's strong financial results underscore the company's change
in scale. With the coming on-line of its Gas Treatment Facility (GTF)
in 2011, Zhaikmunai has initiated its leapfrog transformation with a
record revenue of USD300.8 million and EBITDA of USD197.4 million. This
will in fact be continued in 2012 with the anticipated full GTF
production levels and the associated revenue and EBITDA multiplier
effect."



2011 FINANCIAL HIGHLIGHTS

All figures in USD million unless otherwise stated

                                       FY2011 FY2010 Change YoY

Revenue                                300.8  178.2    + 68.9%

EBITDA                                 197.4   98.8    + 99.8%

Net Cashflow from Operating Activities 132.2   98.9    + 33.6%

Cash Balance                           128.5  147.9    - 13.2%

Debt                                   450.0  450.0       0%

Net Income                             81.6    22.9   + 256.4%


Revenue increased by 68.9% in 2011 to USD 300.8 million (from USD178.2
million in 2010) due to a production increase associated with the Gas
Treatment Facility (GTF) and a 33.3% increase in the average Brent
crude oil price (USD106.9 in 2011 versus USD80.1 in 2010).


Note:

In accordance with IFRS, sales from GTF test production are not
included in the Company's revenue but are offset against capital
expenditure. 2011 cumulative sales of GTF test production (stabilised
condensate, LPG and dry gas) amounting to USD41.7 million hence do not
feature in the reported revenue. Total revenue including sales from
test production would otherwise have been USD342.6 million.


EBITDA doubled in 2011 to USD197.4 million (from USD98.8 million in
2010) and includes the capitalized net proceeds (see Note 4 in the
Financial Statements) adjusted for capitalized depreciation (see Note
16 of the Financial Statements) linked to the GTF test production.
Assuming a total revenue including sales from test production, the
EBITDA margin would be 57,6%.


Net income more than tripled in 2011 to USD81.6 million (from USD22.9
million in 2010).


2011 OPERATIONAL HIGHLIGHTS

All figures in boe unless otherwise stated

                                           FY2011    FY2010    Change
                                                               YoY

Total Production (Crude oil + GTF          4,802,561 2,829,764 + 69.7%
products)

Average Daily Production (Crude oil + GTF  13,158    7,752     + 69.7%
products)


Historically, Zhaikmunai's production growth has been primarily driven
by its growing drilling programme (2008, 2009, and 2010). In 2011,
Zhaikmunai's production growth was primarily driven by the output from
its Gas Treatment Facility (GTF).


As of 31 December 2011, 11 wells were producing from the Tournaisian
reservoir and 8 wells were producing from the Ardatovski and Biski/
Afoninski reservoirs. Over the course of 2011, Zhaikmunai's total
production totalled 4,802,561 boe (including GTF products) with an
average of 13,158 boepd, a 69.7% increase over 2010 with a total
production of 2,829,764 boe and an average of 7,752 boepd.


Zhaikmunai continued to sell its hydrocarbon products primarily on the
export market. In 2011, virtually all of Zhaikmunai's crude oil,
stabilised condensate and LPG was sold directly to its ultimate
customers. Deliveries of dry gas are made to the offtaker(s) at
Zhaikmunai's connection point to the Orenburg-Novopskov gas pipeline.


2012 PRODUCTION UPDATE


Completion of the Gas Treatment Facility (GTF) has enabled the company
to more than double its production of liquids over the last 12 months.
In addition the GTF provides additional revenue from the sale of dry
gas. As of today, the result is a more than five-fold increase in
production from a boepd perspective since January 2011.


Since the beginning of 2012, stable operations have allowed very
substantial total production gains, with noted peaks reaching some
42,000 boepd, marking the end stage of the production ramp-up. Final
production ramp-up is expected to continue through Q1/2012.


In order to reach full design capacity of 48,000 boepd, the following
final steps are being taken:

* Gas condensate Well #401 has been connected to the GTF in order
to further progress towards the maximum design capacity of 40,000 boepd
of the GTF;

* Gas condensate Well # 218, which is currently being drilled, will
be connected to the GTF in April 2012;

* Oil Well # 24B and oil Well # 116 will soon be connected to the
Oil Treatment Facility (OTF) in order to reach the maximum design
capacity of 8,000 boepd of the OTF.


Zhaikmunai intends to further increase its annual hydrocarbon
production beyond 100,000 boepd once a new Gas Treatment Facility is
built and further appraisal and production drilling has been completed
over the next 2 to 3 years.


Kai-Uwe Kessel, CEO of Zhaikmunai, commented:"Stable operations with
high GTF throughput volumes as we have them now
signal the end of the first phase of development of the Chinarevskoye
field. The GTF is running smoothly albeit slightly below design
capacity as processes are currently being fine-tuned in order to
optimize product flow. We look forward to reaching optimal running of
the GTF during the Spring of 2012 thereby laying the foundation for the
second phase of the GTF."


ATTACHED DOCUMENTS


Attached to this press release are Zhaikmunai's 2011 Consolidated
Financial Statements and 2011 Management Report. The latter contains
the following items:


Business Review

Selected Historical Financial Information

Financial Review

Description of Significant Indebtedness and Certain Financial
Arrangements

Key Risk Factors

Management and Corporate Governance

Related Parties and Related Party Transactions

Responsibility Statement



Follow the links below to view the;



2011 Consolidated Financial Statements

 http://www.rns-pdf.londonstockexchange.com/rns/3999Z_1-2012-3-15.pdf 



2011 Management Report

 http://www.rns-pdf.londonstockexchange.com/rns/3999Z_2-2012-3-15.pdf 



CONFERENCE CALL



Zhaikmunai's management team will be available for a Q&A session for
analysts and investors on Wednesday, 21 March 2012 at 2 pm UK time
(GMT).



If you would like to participate in this call, please register by email
using the following email address:  investor_relations@zhaikmunai.com .
Please provide you ID details (name, title, company, email address and
telephone number) in order to receive dial-in details.



Further enquiries



Zhaikmunai LP

Bruno Meere, Investor Relations Officer

 investor_relations@zhaikmunai.com  +44 (0)1624 68 21 79



Pelham Bell Pottinger

Philip Dennis

Elena Dobson+44 (0) 20 7861 3232



About Zhaikmunai

Zhaikmunai is an independent oil and gas enterprise currently engaging
in the exploration and development and production of oil and gas. It is
listed on the London Stock Exchange (Ticker symbol: ZKM). Its principal
producing asset is the Chinarevskoye Field located in north-western
Kazakhstan. Zhaikmunai L.L.P., a wholly-owned subsidiary of Zhaikmunai
L.P., holds a 100% interest in and is the operator of 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.

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

END