JKX.L Regulatory News (JKX)

PRESS ANNOUNCEMENT

FOR IMMEDIATE RELEASE

THIS ANNOUNCEMENT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, INTO OR FROM THE UNITED STATES, CANADA, AUSTRALIA, NEW ZEALAND, JAPAN OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION. PLEASE SEE THE IMPORTANT INFORMATION NOTICE AT THE END OF THIS ANNOUNCEMENT

28 JANUARY 2013

JKX OIL AND GAS PLC ("JKX" OR THE "COMPANY" OR THE "GROUP")

SUCCESSFUL PLACING OF US$40 MILLION CONVERTIBLE BOND

JKX Oil and Gas plc announces that it has successfully entered into arrangements for the placing, subject to certain conditions, of US$40 million of guaranteed unsubordinated convertible bonds due 2018 (the "Bonds") with institutional investors. Of this, US$23.6 million Bonds will be placed on a firm basis and US$16.4 million will be subject to clawback in respect of valid applications made by qualifying shareholders under the open offer. The Bonds will have an annual coupon of 8.00 per cent. per annum and a conversion price set at an initial price of 87.425 pence per Ordinary Share.

The Bonds were conditionally placed through an accelerated bookbuild placement with institutional investors (outside the United States) conducted by ISM Capital LLP, acting as sole bookrunner in connection with the offering.

A circular providing further details of the open offer will be sent to Shareholders as soon as practicable. As the Bonds will be in principal amounts of U.S.$200,000, qualifying shareholders holding fewer than 2,098,420 Ordinary Shares will not have sufficient shares entitling them to subscribe for Bonds in the open offer.

The open offer will be open for acceptance by qualifying shareholders from 28 January 2013 until 11.00 am on 12 February 2013.

It is anticipated that the Bonds will be issued to investors and accepting Shareholders on 19 February 2013.

For further information, please contact:

JKX Oil & Gas plc Tel: +44 (0)20 7323 4464

Dr Paul Davies, Chief Executive Officer

Cynthia Dubin, Finance Director

ISM Capital LLP Tel: +44 (0)20 7938 8984

Christopher Thurn

Edward Males

Cardew Group Tel: +44 (0)20 7930 0777

Anthony Cardew

Nadja Vetter

Canaccord Genuity Hawkpoint Limited Tel: +44 (0)207 665 4500

Paul Baines

expected timetable

Each of the times and dates is indicative only and subject to change. References to a time of day are to London time. Any changes to the timetable will be notified by publication of a notice through a RNS.

key terms of The Firm Placing and Placing and Open Offer

The Bonds

The Bonds to be issued pursuant to the Firm Placing and Placing and Open Offer will be issued in principal amounts of U.S.$200,000 and will be issued at an issue price of 100 per cent. (the ''Issue Price''). The Bonds will have an annual coupon of 8.00% per annum.

118 Bonds will be issued through the Firm Placing (the ''Firm Placed Bonds'') and 82 Bonds will be issued through the Placing and Open Offer (the ''Open Offer Bonds'').

The Bonds will be issued by a wholly owned subsidiary of the Company, JKX Oil & Gas (Jersey) Limited (the ''Issuer''), which has been specifically established for this purpose, and will be guaranteed by the Company. The proceeds of the Bonds received by the Issuer will be loaned by the Issuer to the Company.

The Bonds will be convertible into fully paid exchangeable redeemable preference shares in the Issuer (the ''Preference Shares''), with each U.S.$200,000 principal amount of Bond convertible into one fully paid Preference Share with a paid-up value of U.S.$200,000. The Preference Shares will, upon issue, automatically be transferred (without any further action on the part of the Bondholder) to the Company in consideration for which the Company will either: (i) issue or transfer ordinary shares of 10p each in the Company (the ''Ordinary Shares'') to the relevant Bondholder; or (ii) if the Company makes the Cash Alternative Election (as defined in the terms and conditions of the Bonds), pay to the relevant Bondholder the cash alternative amount in sterling.

The number of Ordinary Shares to be issued to a Bondholder will be determined by dividing the aggregate paid-up value of the Preference Shares being transferred by the exchange price per Ordinary Share (the ''Exchange Price'') (translated into U.S.$ at an exchange rate of 1.5809). The Exchange Price may be subject to adjustment in certain circumstances as set out in the terms and conditions of the Bonds. The Bonds have an initial Exchange Price of 87.425 pence per Ordinary Share.

The Company will have the option, upon giving notice, to redeem the Bonds after four years, if the parity value on each of at least 20 dealing days in any period of 30 consecutive dealing days prior to the giving of such notice shall have equalled or exceeded 130 per cent. of a Bond in the principal amount of U.S. $200,000. The Bonds will mature in 2018 on the fifth anniversary of the issue.

The Firm Placing

ISM Capital, as sole bookrunner for the Company, is making arrangements to conditionally place the Firm Placed Bonds with institutional investors, subject to the same conditions and termination rights that apply to the Placing and Open Offer. The Firm Placed Bonds are not subject to clawback from Shareholders and do not form part of the Open Offer.

The Open Offer

The Open Offer is an opportunity for Shareholders whose names are entered on the Register at the close

of business on the Record Date (the ''Qualifying Shareholders'') to subscribe for Open Offer Bonds as far as practicable pro rata to their current holdings of Ordinary Shares at the Issue Price and in accordance with the terms of the Open Offer. The Open Offer Bonds are being conditionally placed with institutional investors, subject to clawback in respect of valid applications made by Qualifying Shareholders under the Open Offer.

The Bonds will be issued in principal amounts of U.S.$200,000. The Open Offer Bonds are being offered to Qualifying Shareholders, subject to the Conditions, on the following basis:

one Open Offer Bond for every 2,098,420 Ordinary Shares

registered in the name of each Qualifying Shareholder at the close of business on the Record Date, and so in proportion for any other number of Ordinary Shares then registered at a price of U.S.$200,000 per Open Offer Bond.

Qualifying Shareholders holding fewer than 2,098,420 Ordinary Shares on the Record Date will not hold a sufficient number of Ordinary Shares to be able to subscribe for Open Offer Bonds and will not be able to participate in the Open Offer. Entitlements of Qualifying Shareholders who will be able to participate will be rounded down to the nearest U.S.$200,000 aggregate principal amount of Open Offer Bonds. Any resulting fractional entitlements of Qualifying Shareholders arising under the Open Offer will be aggregated and Open Offer Bonds in respect thereof placed with Placees.

The Firm Placing and Placing and Open Offer are conditional on the placing agreement between the Company, the Issuer and ISM Capital (the ''Placing Agreement'') becoming unconditional in all respects. If the conditions to the Placing Agreement are not fulfilled, the Firm Placing and Placing and Open Offer will not proceed and application monies in relation to the Open Offer will be returned to applicants without interest as soon as possible thereafter. The Firm Placing and Placing and Open Offer are not being underwritten by ISM Capital or by any other person. ISM Capital, as agent for the Issuer, shall use its reasonable endeavours to procure subscribers for the Bonds.

Qualifying Shareholders may apply for any principal amount of Open Offer Bonds up to their maximum entitlement which, in the case of Qualifying Shareholders holding Ordinary Shares in certificated form

(the ''Qualifying Non-CREST Shareholders''), is equal to the principal amount of Open Offer Entitlements as shown in their Open Offer Entitlement Form, or, in the case of Qualifying Shareholders holding Ordinary Shares in uncertificated form (the ''Qualifying CREST Shareholders''), is equal to the principal amount of Open Offer Entitlements standing to the credit of their stock account in CREST.

No application in excess of a Qualifying Shareholder's pro rata entitlement will be met and any Qualifying Shareholder so applying will be deemed to have applied for his or her maximum entitlement. Qualifying Shareholders with holdings of existing Ordinary Shares in both certificated and uncertificated form will be treated as having separate holdings for the purpose of calculating entitlements under the Open Offer. Valid applications up to Qualifying Shareholders' pro rata entitlements will be satisfied in full.

The Ordinary Shares to be issued in exchange for the Preference Shares upon conversion of the Bonds will, on the Conversion Date, rank pari passu with the Ordinary Shares then in issue (save for any dividends or other distributions declared, made or paid on the Ordinary Shares by reference to a record date prior to the Conversion Date of the relevant Ordinary Shares).

Qualifying Shareholders should be aware that the Open Offer is not a rights issue. Qualifying Non-CREST Shareholders should also note that the Open Offer Entitlement Form is not a negotiable document and cannot be traded. Open Offer Bonds not applied for under the Open Offer will not be sold in the market for the benefit of those who do not apply under the Open Offer and those Qualifying Shareholders who do not apply to take up Open Offer Bonds will have no rights under the Open Offer.

Qualifying Non-CREST Shareholders who wish to apply for Open Offer Bonds in respect of some or all of their Open Offer Entitlements must first deposit their entitlements into CREST. For an application by a Shareholder to be valid, whether that Shareholder holds its Ordinary Shares in certificated or uncertificated form, a valid USE instruction must settle on or before 11.00 a.m. on 12 February 2013.

Further information on the Firm Placing and Placing and Open Offer, including the procedure for application and payment, is set out in the Circular and in the Open Offer Entitlement Form.

ADMISSION AND DEALINGS OF THE BONDS

The Bonds will be in registered form and will be represented by a global Bond (the ''Global Bond'') registered in the name of, and held by a nominee on behalf of, a common depositary for Euroclear Bank SA/NV (''Euroclear'') and/or Clearstream Banking, socie´te´ anonyme (''Clearstream, Luxembourg'').

It is intended in due course that application will be made for the Bonds to be admitted to the official list of the Luxembourg Stock Exchange and to trading on the Euro MTF. Admission will be conditional on the approval of listing particulars in respect of the Bonds and is expected to occur by no later than the first interest payment date under the Bonds, being 19 August 2013.

ACTION TO BE TAKEN

Qualifying Non-CREST Shareholders

Qualifying Non-CREST Shareholders with Open Offer Entitlements will receive an Open Offer Entitlement Form which gives details of their entitlement under the Open Offer. Qualifying Non-CREST Shareholders holding fewer than 2,098,420 Ordinary Shares will not have any Open Offer Entitlement and will not receive an Open Offer Entitlement Form.

Payment for the Bonds must be in U.S.$ and, to facilitate settlement and comply with applicable money laundering requirements, it is only possible to accept the Open Offer in CREST and using a Cash Memorandum Account which offers settlement in U.S.$. Qualifying Non-CREST Shareholders wishing to apply for Open Offer Bonds must, therefore, deposit their Open Offer Entitlements into a stock account in CREST and ensure they have access to a Cash Memorandum Account which offers settlement in U.S.$. To deposit entitlements Qualifying Non-CREST Shareholders should complete the Open Offer Entitlement Form in accordance with the procedure set out in the Circular and on the Open Offer Entitlement Form itself.

Having regard to normal processing times in CREST, the recommended latest time for depositing an Open Offer Entitlement Form with the CREST Courier and Sorting Service is 3.00 p.m. on 6 February 2013. Qualifying Non-CREST Shareholders who have deposited Open Offer Entitlements into CREST should then follow the procedure for acceptance which applies to Qualifying CREST Shareholders.

Qualifying CREST Shareholders

Qualifying CREST Shareholders will receive a credit to their stock account in CREST in respect of such Open Offer Entitlements. Shareholders holding fewer than 2,098,420 Ordinary Shares will not receive a credit of Open Offer Entitlements.

Payment for the Bonds may only be made using a Cash Memorandum Account which offers settlement in U.S.$ and Qualifying CREST Shareholders should refer to the procedure for application set out in the Circular. Qualifying CREST Shareholders who are CREST sponsored members should refer to their CREST sponsors regarding the action to be taken in connection with this document and the Open Offer.

The relevant CREST instructions must have settled by no later than 11.00 a.m. on 12 February 2013.

Overseas shareholders

The Bonds are not being made available in whole or in part to the public except under the terms of the Open Offer. However, subject to certain exceptions, neither the Circular nor any Open Offer Entitlement Form will be sent to Qualifying Shareholders who have registered addresses in, or who are resident in, the United States, Canada, Australia, New Zealand and Japan, and any other jurisdiction where the extension or availability of the Open Offer (and any other transaction contemplated thereby) would breach any applicable laws, nor will the CREST stock account of Qualifying CREST Shareholders with registered addresses in such territories be credited. Any shareholder who is in any doubt as to his position should consult an appropriate independent professional adviser without delay.

Important Information 

This announcement does not constitute or form part of an offer to sell securities or the solicitation of any offer to subscribe for otherwise buy any securities. The release, publication or distribution of this announcement in certain jurisdictions may be restricted by law. Persons into whose possession this announcement comes are required by the Company to inform themselves about, and to observe, any such restrictions. The securities mentioned in this announcement have not been and will not be registered in the United States under the US Securities Act of 1933, as amended (the "US Securities Act"), and may not be offered or sold in the United States or to, or for the account or benefit of, a US Person (as defined in Regulation S under the US Securities Act), absent registration or exemption from registration under the US Securities Act. For the purposes of this announcement, "United States" means the United States of America, its territories and possessions, any state of the United States of America and the District of Columbia.

This communication is directed only at persons (i) who have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "Order") and qualified investors falling within Article 49(2)(a) to (d) of the Order, and (ii) to whom it may otherwise lawfully be communicated (all such persons together being referred to as "relevant persons"). This communication must not be acted on or relied on by persons who are not relevant persons. Any investment or investment activity to which this communication relates is available only to relevant persons and will be engaged in only with relevant persons.

ISM Capital LLP is acting on behalf of the Company and no one else in connection with the Bonds and will not be responsible to any other person for providing the protections afforded to clients of ISM Capital LLP or for providing advice in relation to the Bonds.

Canaccord Genuity Hawkpoint Limited, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting as financial adviser to the JKX Oil & Gas PLC and no-one else and will not be responsible to anyone other than the JKX Oil & Gas PLC for providing the protections afforded to clients of Canaccord Genuity Hawkpoint Limited or for advising any such person in relation to any matter referred to herein.