VLS.L Regulatory News (VLS)

News release

Velocys plc

("Velocys")

21st December 2015

Settlement of UK IP infringement case

Velocys plc (VLS.L), the company at the forefront of smaller scale gas-to-liquids (GTL) is pleased to announce that it has come to a settlement with CompactGTL Limited in the patent infringement case that Velocys filed in the UK in 2013.

Under the terms of the settlement, CompactGTL will make an undisclosed one-off payment to Velocys in recognition of its intellectual property.

In 2014, the UK High Court upheld the validity of the two Velocys patents in suit (known as '508 and '509), found certain CompactGTL activities at its Wilton pilot plant facility to be infringing both patents - six separate patent claims in total - and awarded an injunction. With this settlement, both the pending appeal by CompactGTL on validity of some of the claims and an enquiry by the UK High Court into damages will be discontinued.

Susan Robertson, CFO and acting CEO, said

"We are pleased that this outstanding legal position has been resolved as we continue our focus on the commercial roll-out of our technology."

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Notes to editors

About VelocysVelocys is the company at the forefront of smaller scale gas-to-liquids (GTL) that turns natural gas or biomass into premium products such as diesel, jet fuel, waxes and base oils. Smaller scale GTL adds value to shale gas and bio-waste, and makes stranded or flared gas economic - an untapped market of up to 25 million barrels per day.

Velocys technology, protected by several hundred patents in over 30 countries, is specifically designed for smaller scales, combining super-active catalysts with intensified reactor systems. The Company's standardised modular plants are easier to ship and faster to install, at lower risk, even in the most remote or challenging locations. Together with world-class partners, Velocys works flexibly to unlock gas resources of 15,000 to 150,000 mmbtu per day, allowing more companies to take advantage of more opportunities.

Velocys plc is listed on the AIM market of the London Stock Exchange (LSE: VLS). The Company is well capitalised and has a multi-disciplinary staff of around 100 operating from its commercial centre in Houston, Texas, USA and technical facilities near Oxford, UK and Columbus, Ohio, USA. Its first commercial plant, funded by Waste Management (NYSE: WM), NRG Energy (NYSE: NRG) and Ventech Engineers, is expected to reach mechanical completion in H1 2016.

www.velocys.com

Think Smaller™. Velocys is changing the way fuels are made.