Caspian Sunrise Regulatory News (CASP)

Roxi Petroleum PLC

("Roxi" or the "Company")

Cancellation of Royalty

Roxi, the Central Asian oil and gas company with a focus on Kazakhstan, is pleased to announce it has entered into an agreement with Canamens Limited ("CL") and Sector Spesit IV, a sub-fund of Sector Umbrella Trust ("SS4") to cancel future royalty payments due to them from production from Roxi's BNG asset in return for the issue of 46,661,654 fully paid ordinary shares representing 5% of the enlarged issued ordinary share capital.

Background

Roxi acquired its interest in the BNG Contract Area in 2008 as part of Roxi's acquisition of 59% of Eragon Petroleum Limited ("Eragon').

In January 2009, Roxi entered into a farm out agreement with Canamens Central Asia BV ("CCA") whereby CCA acquired a 35% stake in BNG from Roxi in return for a $7 million payment to Roxi plus a further $45 million to be paid towards existing BNG work programme commitments.

In March 2011 Roxi announced that CCA had informed Roxi that it would be unable to pay the full amount due under the work programme commitments. On 11 May 2011 an agreement between Roxi and CCA was announced whereby for an initial payment by Roxi of $2.5 million plus a royalty in perpetuity of 1.5% of production revenues (calculated by reference to the wellhead price) (the "BNG Royalty") the 35% stake in BNG previously acquired by CCA was restored to Roxi.

Since that date the BNG Royalty agreement was assigned intra-group by CCA to CL, which holds the benefit of the BNG Royalty as to 50% for itself, and 50% for SS4.

Details of the Cancellation Agreement

Under the Cancellation Agreement, CL and SS4 agree to cancel and terminate in full their interests in the BNG Royalty in consideration of Roxi issuing to CL 46,661,654 new ordinary shares fully paid representing 5% of the enlarged Roxi issued ordinary share capital.

Completion of the Cancellation Agreement is conditional on, and will take place on the business day after, the passing of resolutions 6 and 7 at the annual general meeting of Roxi to be held on 24 July 2015, as set out in the Notice of AGM dated 25 June 2015.

Lock-in agreements

Under the terms of the Cancellation Agreement, CL has entered into a 3 month orderly market agreement.

Subject to completion and upon the issue of 46,661,654 ordinary shares, the total number of ordinary shares in issue following the issue of these shares will be 933,233,077.

Roxi has no shares in treasury, therefore this figure may be used by shareholders from admission as the denominator for calculations by which they will determine if they are required to notify their interest in, or a change in their interest in, the share capital of the Company under the FCA's Disclosure and Transparency Rules.

Inter-conditional agreement with Baverstock

Since January 2015, under the terms of the 2008 Eragon Acqusition Agreement, Roxi and Baverstock have been liable to fund all costs incurred in respect of BNG in the ratio 59:41, including the 1.5% royalty payment on BNG production revenue.

Accordingly, in consideration of Roxi issuing 46,661,654 ordinary shares to cancel the 1.5% royalty under the Cancellation Agreement, Roxi has entered into a parallel BNG Royalty Agreement with Baverstock, with effect from completion of the Cancellation Agreement. Under the terms of this agreement Baverstock will pay to Roxi in perpetuity a royalty payment at the rate of 0.615% of the production revenues at BNG, being 41% of the 1.5% original BNG Royalty to reflect the interest in BNG attributable to Baverstock.

Comment:

Clive Carver, Chairman said

 "This is an excellent deal for Roxi. On completion, we have removed a future uncapped liability, which may have affected the Company's ability to secure traditional debt funding and replaced it with a supportive institutional shareholder."

Enquiries:

Roxi Petroleum PLC Clive Carver, Chairman

+7 727 375 0202

WH Ireland Ltd James Joyce / James Bavister

+44 (0) 207 220 1666