PGR.L Regulatory News (PGR)

5 November 2012

Andes Energia plc

("Andes" or "the Company")

Warrants

In October 2007 Andes, the Latin American E&P group (AIM: AEN; BCBA: AEN), granted subscriber warrants over 12,000,000 ordinary shares of 10 pence each in the capital of Andes ("Andes Shares") and vendor warrants over 12,000,000 Andes Shares (collectively the "Warrants"). As a result of the demerger of the Company's electricity business to Andina plc (Andina"), which was completed on 12 July 2012, the rights of the holders of the Warrants (the "Warrantholders") were adjusted to give the holders the right to subscribe for Andes Shares and ordinary shares of 10 pence each in the capital of Andina in the proportions detailed in the circular dated 9 June 2012. The final exercise date of the Warrants was 2 October 2012, so the Warrants have now lapsed.

As the Warrantholders were fundamental in the successful completion of the Company's acquisition of its Argentinean assets in 2007 and continue to remain supportive in the development and growth of Andes, the Board believes it would be in the best interests of the Company to constitute a new warrant instrument and offer to the Warrantholders the opportunity to subscribe for new warrants ("New Warrants"). The Warrantholders will be offered a number of New Warrants over Andes Shares equivalent to the number of expiring Warrants held following the demerger for a consideration of 3 pence per warrant. This offer to the Warrantholders will remain open for a period of 21 days. The New Warrants will have a five year term with an exercise price of 54 pence per ordinary share and final exercise date falling on the fifth anniversary of the last day of the offer period. The offer letter will be sent to Warrantholders within the next 5 business days.

Nicolas Mallo Huergo, the Chairman of Andes, commented: "We believe it is important to maintain the goodwill and support of these stakeholders, which we believe is in the best interests of shareholders and the Company.".

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Note to Editors:

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