PERTH (miningweekly.com) – South Africa-focused Sunbird Energy has signed a conditional agreement with a South African consortium to divest of its noncash assets for A$8.5-million. The assets include a 74% interest in the Mopane, Springbok Flats and Springbok Flat West coal-bed methane projects, as well as its 76% interest in the offshore Ibhubesi gas project.
The Ibhubesi gas field, off the Northern Cape coast, is South Africa’s largest undeveloped gas field with about 540-billion cubic feet of gas. National oil company PetroSA is Sunbird’s joint venture partner in the project. In 2015, Sunbird signed a gas sales agreement term sheet with utilities provider Eskom for the supply of 30-billion cubic feet a year of gas for up to 15 years, with Sunbird at the time describing the agreement as a major step towards the commercialisation of the Ibhubesi gas field. Sunbird told shareholders on Monday that the conditional agreement with the South African consortium, which consisted of major shareholders and debt holders, included a cash consideration of A$1-million, the buy-back and cancellation of 55-million existing Sunbird shares and the assignment of Sunbird’s A$4.8-million outstanding debt to the purchaser.
The transaction was subject to a number of conditions, including shareholder approval. A general meeting of Sunbird shareholders would be called in late May. The transaction with the privately-held consortium comes months after an indicative takeover proposal from Glendal Power and Industries for Sunbird was withdrawn. Glendal in July last year offered Sunbird shareholders A$0.18 a share for their holding in the company, valuing Sunbird at around A$25-million. The offer was withdrawn in December.