Volga Gas plc provides the following updates.

Drilling operations on VM Well #3

As announced with the Interim Results on 15 September 2014 drilling operations on the VM #3 well on the Vostochny Makarovskoye (VM) field had encountered mechanicals difficulties, with drill pipe being stuck at a depth of 2,556 metres. Subsequent attempts by the drilling contractor to release the stuck drill pipe have not been successful and operations have been suspended.

Volga Gas is working with the contractor to resolve this technical matter and, pending a cost effective solution, which is likely to involve drilling a sidetrack from the existing bore hole at a depth of 1,900 metres, it has been decided to continue suspension of operations. It is therefore likely that VM #3 will not be completed until H1 2015.

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