Capital structure optimisation program of MOL

MOL Hungarian Oil and Gas Public Limited Company ("MOL") hereby announces that the Board of Directors made a decision to develop a more efficient capital structure.

In the previous year MOL reached record earnings, with outstanding group level ROACE of 27.2% excluding one-off gains on gas divestment. In the previous years MOL's refineries were the most efficient refineries in Europe based on several independent studies. Record operating performance was supported by further efficiency improvements, strong demand increase for refined products and better than expected industry environment. MOL has always put great emphasis on assuring competitive return to its shareholders. Our main financial strategic target was to maintain a 15% ROACE ratio (on after-tax basis) for our group for 2006-2010, based even on more conservative oil industry assumptions set at the end of 2005. Despite successfully closing 10 smaller M&A transactions, acquisitions lagged behind plans as our disciplined financial approach prevented us from overpaying for upstream and downstream assets. As a result of strong earnings, disciplined capex and delay in acquisitions, our capital structure reached an inefficient level with having 876m USD net cash on balance sheet at the end March 2007.

We are committed to optimize our capital structure; therefore we announce the following optimization program. Understanding our shareholders expectation for a rapid solution for capital structure optimization, we decided to restart the treasury buy back program. Due to the 10% limitation for treasury shares, we signed an agreement to lend 8,757,362 shares held in treasury, after which MOL will own 2,141,163 "A" series and 578 "C" series shares. This enables us to purchase further treasury shares on the market.

Based on the authorisation of the Annual General Meeting held on 26th April 2007, the Company mandated ING Bank Ltd., as investment service provider to purchase "A" series treasury shares up to 10% of the registered capital on the stock exchange. The purchases can take place until 31 December 2007. The Company will inform market participants in extraordinary announcements of any transactions executed.

On the next AGM (in April 2008) the Board of Directors will ask for authorization of cancelling treasury shares and further share buybacks. However, the Board of Directors intends to maintain the flexibility to use treasury shares as an acquisition currency.

Beside improving the capital structure, MOL will continue to actively seek for further organic growth possibilities and acquisition opportunities to create shareholder value. In line with the previous track record of the Board, reaching our return targets will be superior to volumetric growth targets.