Proposed Transaction in Treasury Shares

Pursuant to Appendix 6 Nr. 31 of the Hungarian Capital Market Act of 2001 MOL Hungarian Oil and Gas Public Limited Company (“MOL”) announced on March 9, 2006, that it plans to sign an agreement to sell approximately 6 million Series A Ordinary Shares of MOL currently held in treasury to Magnolia Finance Limited (“Magnolia”), incorporated in Jersey (22 Grenville Street, St Helier, Jersey, Channel Islands JE4 8PX). As announced by Magnolia, Magnolia plans to offer approximately € 690 million of perpetual exchangeable capital securities (the “Capital Securities”), exchangeable into Series A Ordinary Shares of MOL between years 5 and 10, to institutional investors outside the United States, Canada, Jersey, Japan, Hungary and Poland in reliance on Regulation S under the Securities Act of 1933, as amended. The issuance of the Capital Securities will not be governed by the Hungarian Capital Market Act, thus, it has not been approved by the Hungarian Supervision (PSZÁF). Morgan Stanley & Co. International Limited is acting as Sole Manager.

MOL also plans, concurrently with the sale, to enter into a swap agreement with Magnolia that will give MOL the option to buy back the Series A ordinary shares of MOL in certain limited circumstances.

MOL does not have any direct or indirect equity interest in or control right over Magnolia, but in accordance with the international accounting standards it will consolidate Magnolia in its IFRS financial reports.

Terms of the transaction are expected to be announced after the successful sale of the Capital Securities and the execution of the transaction documentation, which is expected to take place on or around March 10, 2006.