Preferred shares buy back trade

PRESS RELEASE

KMG EP announces the results of a specialised trade of its preferred shares on KASE

Astana, 28 May 2010. JSC KazMunaiGas Exploration Production («the Company», «KMG EP») is pleased to announce that a specialised trade for the repurchase of the Company's preferred shares was held on KASE from 30 April 2010 till 28 Мay 2010.

At the end of this specialized trade the Company accepted applications for the sale of 26,384 preferred shares at the price of 17,093.43 Tenge per share. The aggregate purchase amount was 450,993,057.12 Tenge. This specialized trade will be settled on the 2 June 2010. The Company has now repurchased 307,112 preferred shares for an aggregate price of 6,434,912,565.90 Tenge under its buyback programme. The dates of the next specialised trade under the Company's buyback programme will be announced in due course.

The Company will make announcements before each specialised trade, as well as announcements after each specialised trade informing of the terms and results of such trade.

The listing and the buyback programme are intended to provide preferred shareholders with greater transparency and liquidity. The majority of preferred shares are currently distributed among more than 30, 000 individual shareholders, including present and former employees of KMG EP and their families.

NOTES TO EDITORS

Any preferred shareholder who wishes to sell their shares must place them on account with the Central Securities Depository on or before the time at which such shareholder makes an offer to sell the shares.

Holders of preferred shares must provide limited counter orders to sell their preferred shares. Limited counter orders must indicate a share price at which the shareholder wishes to sell their shares. This price must be denominated in tenge up to two decimal places. The amount of financial instruments specified in the order should be equal to the number of preferred shares that the shareholder wishes to sell. The order volume must be equal to the product of the amount of shares to be sold multiplied by the specified share price.

Limited orders will be accepted at the cut-off price set by the Company at the end of the specialised trade in compliance with applicable laws, regulations and Company's policies. Limited orders that specify a price equal or less than this cut-off price will be accepted and executed. Limited orders that specify a price greater than the cut-off price will not be accepted by the Company.

KMG EP is among the top three Kazakh oil and gas producers. The overall production in 2009 was 11.5mmt (an average of 232kbopd) of crude oil, including the Company's share in Kazgermunai and CCEL. The volume of proved and probable reserves (2P) of KMG EP as at the end of 2009 was 234mmt (1.7bn barrels); while including the share of reserves from associates and joint ventures, preliminary about 2.2 bn barrels. The Company's shares are listed on Kazakhstan Stock Exchange and the GDRs are listed on The London Stock Exchange. The Company raised over US$2bn in its IPO in September 2006. In July 2009 International rating agency Standard & Poor's (S&P) confirmed KMG EP's "BB+" corporate credit rating and assigned the Company "GAMMA-6" level.

For further details please contact us at:

Regarding specialized trade:

RFCA call-center - 8 800 080 01 77 (calls are free of charge within Kazakhstan).

KMG EP. Public Relations (+7 7172 97 7600)

Daulet Zhumadil

E-mail: pr@kmgep.kz 

KMG EP. Investor Relations (+7 7172 97 5433)

Asel Kaliyeva

E-mail: ir@kmgep.kz 

Pelham PR (+44 207 861 3147)

Elena Dobson

E-mail: Elena.dobson@pelhampr.com 

Forward-looking statements

This document includes statements that are. or may be deemed to be. ''forward-looking statements''. These forward-looking statements can be identified by the use of forward-looking terminology. including. but not limited to. the terms ''believes''. ''estimates''. ''anticipates''. ''expects''. ''intends''. ''may''. ''target''. ''will''. or ''should'' or. in each case. their negative or other variations or comparable terminology. or by discussions of strategy. plans. objectives. goals. future events or intentions. These forward-looking statements include all matters that are not historical facts. They include. but are not limited to. statements regarding the Company's intentions. beliefs and statements of current expectations concerning. amongst other things. the Company's results of operations. financial condition. liquidity. prospects. growth. potential acquisitions. strategies and as to the industries in which the Company operates. By their nature. forward-looking statements involve risk and uncertainty because they relate to future events and circumstances that may or may not occur. Forward-looking statements are not guarantees of future performance and the actual results of the Company's operations. financial condition and liquidity and the development of the country and the industries in which the Company operates may differ materially from those described in. or suggested by. the forward-looking statements contained in this document. The Company does not intend. and does not assume any obligation. to update or revise any forward-looking statements or industry information set out in this document. whether as a result of new information. future events or otherwise. The Company does not make any representation. warranty or prediction that the results anticipated by such forward-looking statements will be achieved.