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Sunbird strikes deal to fund Ibhubesi Gas Project offshore South Africa

07th October 2014

Southern African gas explorer and developer Sunbird Energy has announced that binding agreements have been executed in respect of a transaction which, once fully completed, will deliver over USD 22m (subject to exchange rates) into the company at a weighted average premium of up to 79 per cent on the last traded share price and secure a major strategic partner to help advance development of its Ibhubesi Gas Project in South Africa

Sunbird strikes deal to develop Ibhubesi Gas Project offshore South Africa
The Ibhubesi Gas Project has multiple development opportunities to supply the high value South African energy market including ongoing gas sales negotiations with Eskom for the provision of gas to the existing Ankerlig Power Station, Independent Power Producers and major industrial users

The transaction will see the Pan-African investment company, Vandasia Investments Limited (Vandasia), acquire a 43.9 per cent interest in Sunbird.

“Sunbird is pleased to welcome Vandasia as a strategic partner and major new shareholder,” said Kerwin Rana, Sunbird chairperson.

“The investment by Vandasia demonstrates the value proposition of the Ibhubesi Gas Project as South Africa’s largest undeveloped gas field and the advanced nature of our gas supply negotiations with potential customers.”

“This transformational financing deal ensures Sunbird is fully funded to advance Ibhubesi through FEED studies, commercial negotiations and regulatory approval to a final investment decision in 2015.”

This transaction delivers the funding required to advance the Ibhubesi Gas Project to commercialisation and provides Sunbird with a highly capable strategic shareholder with extensive industry experience in Africa.

 “Vandasia has secured this investment opportunity because it sees Sunbird as the most mature gas development project in South Africa, Africa’s most developed economy,” said TJ Lupepe, Vandasia’s CEO.

“The advanced stage of Sunbird’s gas sales negotiations with potential customers, provides near term access to the South African energy market which has depended largely on coal and oil based fuels.

“Vandasia is excited to support Sunbird in providing cheaper, cleaner gas to an energy constrained market and contributing positively to South Africa’s energy mix. Importantly, the Sunbird transaction can begin to shepherd in an era of migration to gas as a power source for Africa at large, proving both the technical and financial viability of the resource for generation input.”

The Ibhubesi Gas Project has multiple development opportunities to supply the high value South African energy market including ongoing gas sales negotiations with Eskom for the provision of gas to the existing Ankerlig Power Station, Independent Power Producers and major industrial users.

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