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Sunbird lands US$23m for Cape Town gas field project

Sunbird lands US$23m for Cape Town gas field project

A Consortium of Nigerian and South African investors has agreed to put AU$25m (US$23m) into Australian-listed Sunbird Energy to help it advance its plans to develop the Ibhubesi offshore gas field, 380km northwest of Cape Town, it said.

Eskom’s use of costly diesel-fired power stations is contributing to its financial crisis. Sunbird is in talks with Eskom on a contract to supply its 1,350MW Ankerlig power station with cheaper natural gas from Ibhubesi.

Sunbird CEO Will Barker told delegates at the Mining Indaba in February it would cost R18bn in total to develop five wells at Ibhubesi and a 400km pipeline in the first phase, followed by another five wells in the second phase. The company has a 76% interest in Ibhubesi, with PetroSA holding the other 24%.

Under the latest agreement, Vandasia Investments will acquire 43.9% of Sunbird through two capital raisings at AU$0.34 a share and the acquisition and conversion of 47.75-million options. The transaction is at a 79% premium overall to Sunbird’s prevailing share price, it said.

The second tranche of financing is conditional on shareholder approval and the execution of a gas term-sheet with "a potential customer." Sunbird said in its latest quarterly update it was working with Eskom to finalise a gas term-sheet, which was expected to be signed in this quarter.

Vandasia is seeking investments in upstream gas, liquefied natural gas and related infrastructure and gas-to-power projects. Its members include investors from WTES Projects, a Nigerian firm that has interests in telecommunications, real estate, construction, oil and gas, power, steel and financial services.

It also has representation from Mdali Group, a South African entity led by Tembalikayise "TJ" Lupepe, which has subsidiaries involved in power, copper tailings, retail shopping centres and middle-income housing. Dr Lupepe participated in the Bombela consortium which built the Gautrain. He said Vandasia had invested in Sunbird because it saw Ibhubesi as the most mature gas development project in SA.

"Vandasia is excited to support Sunbird in providing cheaper, cleaner gas to an energy-constrained market and contributing positively to SA’s energy mix. 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," he said.


Source: BDlive.co.za

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