Novy Neft Limited - Annual Report

Shareholders have recently been sent a copy of the Company's annual report and financial statements for the year ended 30 September 2005 (the "Annual Report").

The Annual report also contains a notice (the "Notice") convening the Company's Annual General Meeting ("AGM") for 10.00 am on 6 February 2006.

The Notice contains four resolutions, the last of which proposes that the Company continues as an investment company until the next AGM (the "Continuation Vote").  This resolution is required to be put to shareholders in accordance with the Company's bye-laws and its launch prospectus dated 13 November 2003.

Shareholders should be aware that the Board is close to finalising proposals with its advisers relating to the repayment of all the Company's assets to Shareholders (the "Termination Proposals").  These proposals are expected to be sent to Shareholders shortly.

In light of the imminent Termination Proposals, your Board makes no recommendation as to how Shareholders should vote on the Continuation Vote as, regardless of the outcome of that vote, the Termination Proposals (if approved by Shareholders) will determine the future of the Company.

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