Nostrum Oil & Gas: Full Year Results for the Year Ending 31 December 2014

Nostrum Oil & Gas PLC (LSE: NOG) (“Nostrum”, and together with its subsidiaries the “Group"), an independent oil and gas exploration and production company with assets in north-western Kazakhstan, today announces the full-year financial results for the twelve months ending 31 December 2014 of Nostrum and the Group, together with its 2014 Annual Report.

Key financial and operational highlights of the Group

  • • Total production of 16.2 mboe (2013:16.9 mboe)
  • • Stable average production of 44,400 boepd for 2014
  • • 2P reserves at 571.1 mboe as at 31 December 2014
  • • Revenue of US$782m (2013: US$895m)
  • • EBITDA of US$495m (2013: US$551m)
  • • EBITDA margin remains steady at 63% (2013: 62%)
  • • Net income of US$146m (2013: US$220m)
  • • US$400m in cash and cash equivalents as at 31 December 2014
  • • Dividend of US$0.27 per Ordinary share proposed by the board for 2014

Frank Monstrey, Chairman of Nostrum Oil and Gas PLC commented:

“Nostrum continued to perform well in 2014 despite the year ending with a challenging oil price environment. We consistently delivered production of approximately 45,000 boepd and started the appraisal programme on our 3 additional fields. Whilst the financial performance of the Company was not as strong as in 2013, as a result of a falling oil price during the second half of the year, we were still able to end the year with over US$400 million of cash and cash equivalents on our balance sheet. The combination of the US$400 million bond we placed in early 2014 and the hedge we put in place fr om February 2014 means that we are well positioned to be able to sustain a period of prolonged low oil prices and still deliver on our strategy. Thus, our ambitions to build the leading CIS independent E&P company remain as strong as ever. We completed our Premium Listing on the London Stock Exchange during 2014 and we are now a member of the FTSE250, which further demonstrates the ambition we have to achieve the highest standards in everything we do. I believe the current environment can provide opportunities, rather than lim itations for Nostrum.”

Kai-Uwe Kessel, CEO of Nostrum Oil and Gas PLC commented:

“2014 was another strong year from an operational perspective. It saw the gas treatment facility continue to operate at full capacity with a complete range of hydrocarbon products being delivered to various destinations outside Kazakhstan. Nostrum is now deep into its second development phase, which will entail the engineering, planning, procurement, construction and commissioning of the new gas plant as well as a scalable drilling programme spanning the next 4-5 years.

Significant steps have been made in the construction of our next GTU, which will allow us to double our production capacity by the end of 2016. We have spent over US$150 million to date and expect the total cost to be below US$500 million.

Our Proven reserves remained stable as we replaced over 60% of our production since August 2013. Whilst the oil price environment is extremely different from the end of 2013 our strategy remains unchanged. We have made some reductions to our drilling programme but aim to fill the GTU3 by the end of 2017, so as to reach a combined, together with GTU 1 & 2, production of 100,000 boepd. We are well positioned to withstand the low oil price environment as we have a healthy cash balance and low costs of production. I am very excited about the future of our current asset base, as well as the potential we have for further expansion over the coming years.”



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