VOG.L Regulatory News (VOG)

17 May 2005 07:01

Victoria Oil & Gas PLC17 May 2005 17 May 2005 Victoria Increases Stake in West Medvezhye Project to 90% • Acquisition of additional 15.2 percent stake in SeverGas-Invest ("SGI"), the owner of the West Medvezhye gas and gas condensate project for 1.2 million ordinary shares of Victoria • Victoria ownership has now increased to 90 percent Victoria Oil & Gas Plc ("Victoria") (Ticker:VOG), the AIM listed oil and gasdeveloper in the Former Soviet Union, today announces the acquisition of anadditional 15.2 percent of SGI, the owner of the West Medvezhye gas and gascondensate project in the Yamal-Nenets Autonomous Region of Russia. As a resultVictoria's total shareholding in SGI has been increased to 90 percent. Commenting on the deal, the Chairman of Victoria, Kevin Foo said: "This is anexcellent transaction for both parties and further proof that value adding dealscan be done in Russia. These terms allow Victoria to increase its holding in avery promising project located in a region that contributes almost 20 percent ofthe world's total proven gas reserves." The terms of the deal are: • Victoria will acquire 15.2 percent of SGI in return for a total of 1,200,000 ordinary Victoria shares • Victoria has also agreed to waive its outstanding claim of US$2.6 million against the vendors of the 74.8 percent of SGI acquired in November, 2004. This claim previously has been covered by withholding the sales consideration comprising ordinary shares in Victoria which were put into escrow • These shares will be released from escrow, but will be subject to an orderly marketing agreement with Victoria's brokers and limits to the number of shares that can be disposed over any period of time • Victoria will retain a right of first refusal for the remaining 10 percent of SGI Drilling at West Medvezhye to Begin in June Commenting on upcoming drilling at West Medvezhye, Executive Director, WilliamKelleher, said: "Preparations are on schedule for the recommencement of drillingon Well #104, to begin next month. Combined with our Kemerkol project inKazakhstan, which will bring in near term oil production revenue, Victoria isputting itself in a strong position." For further information please contact: Kevin Foo / George Donne Jamie Cumming / Tracy Mackenzie Victoria Oil & Gas Plc Bell Lawrie +44 (0)207 921 8820 +44 (0)141 314 8103 +44 (0)141 314 8220 Leesa Peters/ Laurence Read Conduit PR +44 (0)207 618 8760 +44 (0)7979 955 923 This information is provided by RNS The company news service from the London Stock Exchange