Petroneft: Statement and Recommendations on the Extraordinary General Meeting Called by Natlata Partners

Dear PetroNeft Shareholders,

As you may be aware, your Board has received a notice requisitioning an extraordinary general meeting (EGM) of the Company from a single shareholder, Natlata Partners Limited (“Natlata”) a company registered under the laws of the British Virgin Islands. The EGM will be held at 11:00 AM at the Herbert Park Hotel, Ballsbridge, Dublin 4, Ireland on 18 April 2016.

Natlata, has notified PetroNeft that it has a beneficial shareholding of 208,429,458 ordinary shares (29.47% of the issued share capital of the Company). Natlata has put forward eight resolutions which seek to replace four existing Board members with three of their own nominees. Full details are available here.

Your Board continues to unanimously recommend that shareholders VOTE AGAINST ALL THE RESOLUTIONS proposed by Natlata at the EGM.

Key Reasons for the Board’s Recommendation to Vote AGAINST ALL the Resolutions:

– Natlata has provided insufficient disclosure regarding its plans and proposed strategy for the Company, including in relation to proposed funding, and key long term Executive management.
– The passing of the Natlata resolutions would cause material risks for PetroNeft and its Shareholders and in particular could lead to the;
– Loss of operatorship of Licence 61
– Loss of key funding available from Oil India for the development of Licence 61
– Loss of good corporate governance required of a company traded on UK and Irish public markets given the record of certain of Natlata’s proposed Board members
– Loss of representation on the Board for the independent majority of Shareholders’ interests
– Real risk that the Company’s strategy will be changed or related party transactions may be undertaken that could be to the detriment of independent majority of Shareholders
– Real risk that the new Board could seek to cancel the admission to trading of the Ordinary Shares contrary to the interests of independent majority of Shareholders.

Should the EGM Resolutions be passed there can be no guarantee that PetroNeft would continue to be suitable for trading on the AIM Market of the London Stock Exchange and the ESM Market of the Irish Stock Exchange. Persons associated with Natlata, including two of the proposed Directors, have recently been involved in the shareholding or management of two public companies that have been delisted.