Ncondezi Energy Limited (“Ncondezi” or the “Company”) (AIM: NCCL) is pleased to announce that it has raised a total of £600,000 before expenses by way of a placing.

Highlights

• Raised a total of £600,000 before expenses via the issue of 40,000,000 ordinary shares of no par value (“Ordinary Shares”) in the Company (“Placing Shares”) at a price of 1.5 pence per Placing Share (the “Placing Price”) (the “Placing”).
• Scott Fletcher, a Non Executive Director of the Company, has subscribed for 3,333,333 Placing Shares in the Placing for a total of £50,000. Following the Placing Scott Fletcher will be beneficially interested in 76,823,020 Ordinary Shares, representing approximately 18.7 per cent. of the Company’s enlarged issued share capital.
• For every two Placing Shares subscribed for in the Placing participating investors will receive a non-transferable warrant to subscribe for an Ordinary Share with an exercise period of eighteen months from the date of admission to trading on AIM of the Placing Shares (“Admission”) and exercisable at a price of 3 pence per Ordinary Share (the “Placing Warrants”).
• In addition to the Placing, Hanno Pengilly, the Company’s CEO, has confirmed his intention to apply any bonus due to him on the achievement of various milestones in relation to 2021 in subscribing for new Ordinary Shares in the Company at a price which will be determined by, amongst other things, the prevailing share price of the Company’s Ordinary Shares at that time. Any such subscription will be subsequent to completion of the Placing and is conditional upon the approval of certain shareholder resolutions at the Company’s AGM to be held in 2021.

The Company will use the net proceeds of the Placing for general working capital purposes and development expenditure at the 300MW Ncondezi Project (the “Project”).

Ncondezi Chief Executive Officer, Hanno Pengilly said:

“We are pleased to have successfully completed the fund raise which ensures the Company is adequately capitalised to complete the next phase of de-risking milestones for the Project. The Board considered a range of funding options and proceeded with the fundraise as the best solution on a cost and dilution basis for all shareholders versus other alternative financing arrangements that were proposed.

Despite the increasing challenges around coal investment globally, a strong business case remains for its use as a key supplier of reliable, low-cost baseload power. As a result, coal power remains one of the main generation sources globally, and Ncondezi believes it can play an important role as part of a balanced and sustainable energy transition for the southern African region whilst adhering to the strictest international environmental standards.

The Company can now fully focus its attention on delivering key workstreams to further advance the Project before year end. The recent commitment from CMEC to sign the EPC contract this quarter, provides a critical steppingstone for the delivery of future milestones.

We look forward to updating shareholders in due course.”