PGR.L Regulatory News (PGR)

20 December 2012 

Andes Energia plc

("Andes" or "the Company")

Colombia Update

Following our announcement on 26 November 2012, the Board of Andes (AIM: AEN; BCBA: AEN), the Latin American E&P group, is pleased to announce that the Company, through its subsidiary Andes Energía Argentina S.A., in a consortium with Integra Oil & Gas SAS ("IOG"),has been awarded one further block in the Colombia Round 2012 bidding process, bringing the total number of blocks awarded to eight.

Colombia has become one of the most exciting E&P investment markets and is the third largest crude oil producer in South America. The new block, Llanos 3, is located in the Llanos basin, the most prolific basin in Colombia. The block is surrounded by fields that are currently in production and the Board believes it has a high potential for conventional and unconventional resources. Andes will seek to develop and put into production the full potential of this new block.

The Board is also pleased to announce that the contracts for all eight exploration blocks have now been executed and completed.

Andes and IOG have entered into an agreement under which IOG will fund the exploration programscovering four of the eight blocks awarded. IOG is a French private registered company with operating activities in Venezuela and holds a 26.39% interest in Lagopetrol S.A. IOG is a company connected with a major shareholder of Andes.

Andes has also entered into a consortium agreement with IOG and Trayectoria Oil & Gas, to pursue the possible acquisition of producing blocks being offered in a bidding process by Ecopetrol, Colombia's national oil company. Andes Energia holds a 30% interest in this consortium.

Nicolas Mallo Huergo, Chairman of Andes, commented, "We are very pleased with the award of an additional block and the formal completion of the agreements and we look forward to developing the full potential of these blocks. Our entrance in Colombia is one step in our asset diversification strategy, as we seek to acquire assets in highly competitive and profitable markets. With Colombia being one of the largest crude oil producers in South America, the development potential of these blocks will help us achieve our goal of becoming one of the top Latin-American players."

For further information please contact:

Note to Editors:

Andes is a Latin American oil and gas group, with interests in Argentina, Paraguay and Colombia. The Company's focus is on the oil and gas sector in South America, which offers premium assets at undervalued prices.