JKX Oil & Gas plc Annual Report 2011137At a glance01-17Board statements18-23Operational review24-36Financial review37-47CSR review48-61Directors' reports62-83Financial statements84-136Five year financial recordYear ended 31 December2011 2010 2009 2008 2007$m $m $m $m $mRevenue - Oil 81.578.8 76.4 121.8 122.5- Gas 143.1112.9 118.1 83.1 59.4- Management services/other 12.31.2 2.0 2.1 2.6Total 236.9192.9 196.5 207.0 184.5Provision for impairment/write off of exploration costs (12.9) (13.7) (5.0) (6.9) (17.7)Production based taxes (67.1) (5.2) (4.0) (4.0) (3.3)Exceptional item - impairment of Russian assets - (74.6) - - -Other cost of sales (49.6) (51.1) (53.5) (51.1) (37.5)Total cost of sales (129.6)(144.6) (62.5) (62.0) (58.5)Gross profit 107.3 48.3 134.0 145.0 126.0Administrative expenses (25.7) (25.3) (14.6) (12.7) (12.2)Gain/(loss) on foreign exchange 0.5 (2.6) (2.3) (6.9) (0.2)Gain on disposal/impairment of investment - - 2.5 - (5.0)Profit from operations before exceptional item 82.1 95.0 119.6 125.4 108.6Profit from operations after exceptional item 82.1 20.4 119.6 125.4 108.6Net other income and interest - 0.4 (0.3) 2.2 4.7Profit before tax 82.1 20.8 119.3 127.6 113.3Taxation (22.9) 0.4 (34.0) (49.4) (38.9)Profit for the year 59.1 21.2 85.3 78.2 74.4Profit attributable to owners of the parent 59.1 21.2 85.3 78.2 74.4Ordinary dividends on equity shares (7.2) (13.2) (12.3) (13.6) (10.0)Earnings per share before exceptional item (cents) 34.37 47.56 54.23 49.85 47.97Earnings per share after exceptional item (cents) 34.37 12.38 54.23 49.85 47.97Group operating margin (%) 34.6 10.6 60.9 60.6 58.9Employment of group capital Non-current assets 563.2 460.8 375.9 303.4 253.4Net current (liabilities)/assets (32.4) 26.8 63.1 62.3 58.0Non-current liabilities (24.0) (18.9) (34.7) (31.5) (25.2) 506.8468.7 404.3 334.2 286.2Group capital employed Capital and reserves 506.8468.7 404.3 334.2 286.2 506.8468.7 404.3 334.2 286.2Net funds Cash and cash equivalents 19.1 62.0 74.4 64.8 68.1Restricted cash 9.8 - - - -Total cash 28.9 62.0 74.4 64.8 68.1Net gearing (%) 8.0 N/A N/A N/A N/A

138NOTICE is given that the Annual General Meeting of JKX Oil & Gas plc (the 'Company') will be held at the Institute of Directors, 116-123 Pall Mall, London SW1Y 5ED on Thursday 24 May 2012 at 10.00am for the following purposes:As ordinary businessTo consider and, if thought fit, pass the following resolutions, which will be proposed as ordinary resolutions:1. To receive the accounts of the Company, the Directors' Report and the Auditors' Report thereon for the year ended 31 December 2011. 2. To approve the Remuneration Report for the year ended 31 December 2011.3. To re-appoint Cynthia Dubin, who has been appointed since the last annual general meeting of the Company and whose biographical details are included at page 62 of the 2011 Annual Report, as a director of the Company.4. To re-appoint Alastair Ferguson, who has been appointed since the last annual general meeting of the Company and whose biographical details are included at page 63 of the 2011 Annual Report, as a director of the Company.5. To re-elect Lord Oxford, who has served on the board of directors of the Company for more than nine years and whose biographical details are included at page 63 of the 2011 Annual Report, as a director of the Company.6. To re-elect Dipesh Shah, who retires by rotation and whose biographical details are included at page 63 of the 2011 Annual Report, as a director of the Company.7. To re-appoint PricewaterhouseCoopers LLP as auditors of the Company to hold office from the conclusion of this meeting until the conclusion of the next general meeting of the Company at which accounts of the Company are laid before the members.8. To authorise the directors to determine the remuneration of the auditors. As special business To consider and, if thought fit, pass the following resolutions, which will be proposed as special resolutions:9. That the Company be and is hereby generally authorised pursuant to Section 701 of the Companies Act 2006 (the 'Act') to make market purchases (within the meaning of Section 693(4) of the Act) of fully paid ordinary shares in the capital of the Company on and subject to the following conditions but otherwise unconditionally:(a) the maximum aggregate number of ordinary shares hereby authorised to be purchased is 17,166,770;(b) the maximum price (exclusive of expenses) which may be paid for each such ordinary share is an amount equal to 105 per cent of the average of the middle market quotations for an ordinary share (as derived from the London Stock Exchange's Daily Official List) for the five business days immediately preceding the day on which such ordinary share is contracted to be purchased and the minimum price (exclusive of expenses) which may be paid for such ordinary share is the nominal value of such ordinary share at the time of such purchase; and(c) unless previously varied, revoked or renewed, the authority conferred by this resolution shall expire on the earlier of the date falling 15 months after the passing of this resolution and at the conclusion of the next annual general meeting of the Company after the date on which this resolution is passed, provided that the Company may, before the expiry of the authority granted by this resolution, enter into a contract to purchase ordinary shares under this authority which will or may be completed or executed wholly or partly after the expiry of such authority and may make a purchase of ordinary shares in pursuance of such contract.10. That the directors be and they are hereby empowered pursuant to Section 570 of the Act to allot equity securities (within the meaning of Section 560 of the Act) for cash pursuant to the authority to allot such securities passed at the annual general meeting of the Company held in 2010 or by way of a sale of treasury shares as if Section 561(1) of the Act did not apply to any such allotment, provided that this power shall be limited to:(a) the allotment of equity securities in connection with a rights issue or offering in favour of ordinary shareholders where the equity securities respectively attributable to the interests of all ordinary shareholders are proportionate (as nearly as may be practicable) to the respective numbers of ordinary shares held by them, subject to such exclusions or other arrangements as the directors may consider necessary or expedient to deal with treasury shares, fractional entitlements, record dates, statutory restrictions, legal or practical problems under or resulting from the application of the laws of any territory or the requirements of any recognised regulatory body or stock exchange in any territory; andNotice of Annual General Meeting