Energo Acquires Stake in Carpathian

Energo Holdings Corp. has acquired 23,287,543 ordinary shares of Carpathian Resources Limited from Elcos (Qld) Pty Ltd, Barchester Pty Ltd, Burnal Pty Ltd, Royal Sunset Pty Ltd, Persal and Co Investments Pty Ltd and Redbrook Nominees Pty Ltd. Energo now owns 17.33% of the issued share capital of Carpathian.

In addition, Elcos Pty Ltd and Persal and Co Investments Pty Ltd have assigned the benefit of Carpathian's A$1,000,000 (approximately 415,000) 10% interest secured convertible notes ('Notes') to Energo.

Energo has agreed, subject to shareholder approval, to increase its proposed subscription from 50 million ordinary shares (as announced on 20 April 2007) to 100 million ordinary shares at 6.5 cents (approximately 2.7 pence), representing A$6.5 million (approximately 2.6 million) of additional equity funding for Carpathian.

Carpathian plans to use this funding to implement a new growth strategy by evaluating and acquiring interests in Russian, European, Middle Eastern and Kazakhstan oil and gas fields and infrastructure, and by investing further in the Company's existing asset portfolio.

The proposed subscription for 100,000,000 ordinary shares and the potential conversion of the Notes by Energo would result in Energo increasing its voting power above 20%. A general meeting of shareholders will be held to consider resolutions pursuant to item 7 of section 611 of the Corporations Act and Listing Rule 10.11 of the Listing Rules of Australian Stock Exchange Limited approving the subscription of shares and the conversion of the Notes ('General Meeting').

In addition, Carpathian has resolved to undertake an interim fundraising to commence a comprehensive review of its current assets and to initiate due diligence on several oil and gas opportunities in Russia, Kazakhstan, Europe and the Middle East by making a private placement of up to 20 million ordinary shares at an issue price of 6.5 cents to raise up to A$1,300,000 (approximately 0.54 million). This is expected to take place prior to the General Meeting.

The ordinary shares to be issued pursuant to the placement are proposed be made to European and other investors associated with Lagral Capital S.C.P.

In addition, the Board has resolved, subject to shareholder approval, to grant to Clarion Finance (or its nominees) and to new board members Anthony Hawkshaw and Robert Downey (or their nominees), a total of 15 million options to purchase ordinary shares with an exercise price of 10 cents each and an expiry date of 30 June 2012. Of the 15,000,000 options Clarion Finance will be granted 14,200,000 options as consideration for its introduction fee in relation to the Acquisition and each of Anthony Hawkshaw and Robert Downey will be granted 400,000 options each as consideration for their assistance in negotiating and closing the Acquisition and as an incentive for their ongoing work in developing and implementing a new strategic plan for the Company.

Carpathian will issue a notice of General Meeting to convene the General Meeting to consider all the relevant matters raised above as soon as practicable.


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