PGR.L Regulatory News (PGR)

21 January 2013

Andes Energia plc

("Andes" or "the Company")

New Export Oil Price

The Board of Andes (AIM: AEN; BCBA: AEN), the Latin American E&P company, is pleased to note that, with effect from 3 January 2013, the Argentine Secretary of Energy, through resolution 1/2013, has established a new export selling price for crude oil of US$70/bbl (up from US$42/bbl) when the international price exceeds US$80/bbl. This new pricing structure replaces the Oil Plus program and is available to any oil company exporting crude oil. Martin Buzzi, Governor of the Chubut province said in a local newspaper: "This new oil export pricing structure benefits the whole industry.".

Whilst Andes is currently selling its production domestically in Argentina, the new pricing structure creates a considerable incentive for exploration and production of conventional and unconventional resources in the San Jorge basin, a catchment area that exports oil. In this particular basin, Andes holds 1,749,356 net exploration acres and is carried by YPF, Argentina's leading oil company.

Nicolás Mallo Huergo, Chairman of the Company commented: "The new price for exported oil will increase activity in the region. We will analyse our Golfo San Jorge portfolio with YPF with a view to accelerating exploration programs to take advantage of this opportunity.".

A local press article covering the change can be found at:

http://www.diariojornada.com.ar/60435/Politica/Se_definieron_las_nuevas_retenciones_que_reemplazaran_al_Petroleo_Plus.

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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.