Cadogan Reports on Court Appeals for Ukrainian Licenses

Cadogan has provided a further update regarding its Pirkovskoe and Zagoryanska special permits.

As previously announced, the Poltava Regional Administrative Court made a decision in Cadogan's favor on September 26, 2008 and found the Ministry of Environmental Protection for Ukraine Orders nos. 396 and 397, regarding the cancellation of Cadogan's licenses, unlawful and dismissed these Orders.

Further to Cadogan's announcement on November 19, 2008, written confirmation that appeals against these dismissals have been lodged with Kharkiv Administrative Court of Appeal on behalf of Poltavanaftogazgeology and NJSC "Nadra Ukraine" has now been received.

Cadogan does not believe that the Appeals have any merit because, as announced on October 13, 2008, on October 7, 2008, further to the Poltava Court's decision in Cadogan's favor, the Ministry of Environmental Protection itself revoked its earlier orders nullifying the Licenses and instead declared them to be valid. Cadogan will contest the Appeals vigorously, and will provide an update on the timing of the process in due course.

Cadogan has also been informed of, but is still awaiting written confirmation regarding, a separate appeal against the September 29, 2008 decision of the Kharkiv Court, which upheld in full the appeals filed by Cadogan against the original written rulings of Poltava Court of June 17, 2008, which first called into question the validity of the Licenses. Cadogan will contest vigorously any such further appeal if and when confirmed.

Cadogan has also commenced a defamation case against NSJC Nadra Ukraine regarding the press release circulated on July 21, 2008 claiming that the Licenses were invalid. An update on this situation will be provided to the market when relevant.