Molopo to Sell South African Gas Assets

Molopo Energy has reached an agreement with a South African-based party to divest its interests in its South African biogenic gas assets, which include a Production Right granted in 2012.

The Transaction, with a potential value of up to 53 million Rand (45.3 million), will be effected via a sale of the shares of Molopo’s South African subsidiary, Molopo said in a statement.

With the company’s strategic initiative to focus on North American exploration and development, the South African assets were no longer core to Molopo’s business, the company said.

Molopo has approx. 900,000 net undeveloped acres prospective for gas in the Virginia area in the Free State province and the Evander area southeast of Johannesburg, with an 80% working interest after Black Economic Empowerment (BEE) and Government participation.

Molopo’s focus in South Africa is in its Virginia area, where gas flow continues from 11 pilot production wells at approx. 1.2 MMcf/d. Molopo was awarded the first onshore natural gas Production Right on Sept 21 2012 and the company has a gas sales agreement for initial volume of 0.6TJ/d, expandable to 8 TJ/d.