HDY.L Regulatory News (HDY)

For immediate release 19 January 2011

Hardy Oil and Gas plc

("Hardy" or "the Company")

Trading update

Hardy Oil and Gas plc (LSE: HDY), the oil and gas exploration and production company with assets in India, provides an operational update and review of 2010.

2010 was an active year for the Company on many fronts, including the following:

·; Disposal of Hardy Oil (Africa) Limited in order to concentrate on de-risking the Company's exploration interests in India, realising gross proceeds of $4.6 million.

·; Production from the PY-3 field in 2011 exceeded expectations after the resumption of production on 24 January 2010. Gross production averaged approximately 3,150 barrels per day (bbld) during 2010, compared with the Company's forecast of 3,000 bbld.

·; The Company announced the fourth consecutive natural gas discovery (Dhirubhai 52) on the Company's D3 exploration block in the Krishna Godavari Basin. The well encountered a gross gas pay zone of 37.5 m in Pliocene aged sands.

·; The second exploration well on the D9 exploration block recorded gas shows while drilling and proved the existence of thick, reservoir quality sands and a petroleum system in this frontier, deep water block. The cost of this well, which was plugged and abandoned following MDT testing, was well below budget.

·; A proposal for the declaration of commerciality of the Dhirubhai 33 natural gas discovery on the GS-01 exploration block located offshore the west coast of India, was submitted by the operator to the DGH in mid 2010.

·; Following the divestment of its interests in Nigeria and a placing in December 2010, (which raised £6.8 million), the Company has the focus and funds to complete its exploration programme in India.

2011 also promises to be an active year for Hardy:

·; The most recent discovery on D3 brings the total number to four and Hardy expects that applications for these discoveries for commerciality will be submitted to DGH during the first quarter of 2011. The Krishna Godavari Basin is an emerging world-class petroleum province and, together with rapidly improving Indian gas pipeline infrastructure and high demand for gas, the prospects for the economic development of gas resources in this area are good.

·; Four of the six commitment wells have now been drilled on the D3 exploration block. Several material undrilled prospects exist on this block and the timing of drilling the two remaining commitment wells will be determined by the operator of the block.

·; Hardy expects to receive approval of commerciality in respect of the application made for the GS-01 Dhirubhai 33 natural gas discovery, in the near future.

·; The Company believes the PY-3 field, which it operates, has at least another 15 million barrels of recoverable reserves. During 2011, Hardy will seek approval from its partners and the GOI to drill two further producing wells in 2012, and upgrade the production facilities to include gas compression to extend the field life.

·; Following the exploration well result on D9, announced earlier this month, which confirmed a petroleum system and was subsequently plugged and abandoned, Hardy is working with the operator to update plans for this extensive block, which has considerable remaining prospectivity.

·; A revised Competent Person's Report is expected to be published in the first quarter of 2011, as part of the Company's annual update of its reserves and resources.

The Company's 2010 preliminary results are anticipated to be announced on 16 March 2011.

For further information please contact:

NOTES TO THE EDITORS

Hardy Oil and Gas plc is an upstream oil and gas company focused in India. Its portfolio includes a blend of exploration, appraisal, and production assets. Hardy's goal is to evaluate and exploit its asset base with a view to creating significant value for its shareholders.

Hardy Oil and Gas plc has existing production from an offshore field in India's Cauvery basin. Hardy also has interests in four offshore exploration blocks in India's Saurashtra, Cauvery, and Krishna Godavari basins, and one onshore exploration block in the Assam Basin.

Hardy is incorporated under the laws of the Isle of Man and headquartered in London, UK. Ordinary shares of Hardy were admitted to the Official List and the London Stock Exchange's market for listed securities effective 20 February 2008 under the symbol HDY.

The Company's Indian assets are held through the wholly owned subsidiary Hardy Exploration & Production (India) Inc, located in Chennai, India.

For further information please refer to our website at www.hardyoil.com

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