Osman Shahenshah, Chief Executive of Afren, said, “We are honoured to welcome Sojitz, Japan’s major diversified industrials and investment conglomerate, as a long term investor and strategic partner of Afren. The strategic alliance is highly complementary given Sojitz financial backing and imperative to secure strategic reserves, and Afren’s unparalleled access to opportunities in Africa. The Strategic Alliance with Sojitz will place Afren, the largest independent pure-play African Independent Oil and Gas Company, in an even stronger financial and strategic position as we look to realise opportunities of scale in the region.”

Afren plc has entered into a strategic alliance with Sojitz Corporation (Sojitz) to jointly pursue significant acquisition opportunities in Africa.

Highlights

• Afren has entered into a strategic alliance (the “Strategic Alliance”) with Sojitz, the major Japanese diversified industrials and investment conglomerate with total assets of US$27 billion. • Sojitz and Afren will jointly pursue acquisition opportunities of scale in Africa “Joint Acquisitions”. • The Strategic Alliance will run for an initial period of (i) 3 years from the signing date or (ii) the date upon which Sojitz has invested a total of US$500 million in the Joint Acquistions (“Sojitz Investment”). • Afren will identify material and strategic assets which it believes should be acquired by the parties. • As appropriate, Sojitz will provide financial support to the Strategic Alliance, including among other things, securing the participation of Japanese Governmental funds. • To further align interests, Afren has agreed to Sojitz investing US$45 million in Afren in the form of loan notes (the “Notes”). • The Notes become convertible bonds (the “Bonds”) at the time of entering into, or announcing Joint Acquisitions. • The amount of Bonds issued is pro-rata to Joint Acquisitions made and the Sojitz Investment. • Hiroshi Kanematsu (President of the Energy and Mineral Resources Division and Senior Executive Managing Officer of Sojitz) will join Afren’s International Advisory Board.

The Strategic Alliance Agreement sets out the terms under which Sojitz and Afren will jointly pursue material asset and corporate acquisition opportunities. The alliance is highly complementary: with Sojitz’s financial strength and desire to expand its access to strategic oil and gas reserves and production in Africa and Afren’s unparalleled access to opportunities in the region.

Under the Agreement, and as appropriate, Sojitz will provide financial support to the alliance for the purpose of funding material Joint Acquisitions, among other things, including by securing funding and credit support from Japanese Governmental funds.

In order to solidify and further align the strategic relationship, Sojitz will make a direct investment in Afren in the form of the Notes, with an initial US$45 million nominal value. The Notes will convert into Bonds at the time of entering into, or announcing, Joint Acquisitions. The amount of Bonds issued is pro-rata to Joint Acquisitions made and the Sojitz Investment. The Notes and the Bonds bear an annual coupon of Libor plus 2%, and mature on the third anniversary of the date of the agreement. The conversion price of the Bonds is calculated by reference to the 30 day volume weighted average price of Afren shares ending on the earlier of the time of entering into, and announcing, each Joint Acquisition.

As part of the Agreement, the parties will establish a joint working group and the Board of Afren has agreed to the appointment of Hiroshi Kanematsu to Afren’s International Advisory Board, where he will join Brian Ward, the former Regional Chief Executive for Shell Africa and Ennio Sganzerla, the ENI Group’s former Senior Vice President for Africa. Mr Kanematsu is President of the Energy & Mineral Resources Division at Sojitz Corporation and Senior Managing Executive Officer of Sojitz. Mr Kanematsu has been involved in international energy and mining projects for over 25 years.

Hiroshi Kanematsu, President, Energy and Mineral Resources Division, Senior Managing Executive Officer Sojitz Corporation, said, “We are delighted to have formalised our existing relationship with Afren. We view the relationship as a marriage of strategic values – our desire to secure strategic oil and gas reserves/production and Afren’s unparalleled access in Africa. As International Oil Companies and Super Majors undergo a rationalisation of their portfolios, we recognise Afren’s ability as ‘The African Player of choice’ for National Oil Companies, the International Oil Companies and indigenous operators.”

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