OANDO PLC - Oando Energy Resources Executes Binding Loan agreement for acquisition of Nigerian assets from Conocophillips

Oando Energy Resources Executes Binding Loan agreement for acquisition of Nigerian assets from Conocophillips

Oando PLC
(Incorporated in Nigeria and registered as an external company in South Africa)
External Registration number: RC 6474
Company registration number: 2005/038824/10
Share Code on the JSE Limited: OAO
Share Code on the Nigerian Stock Exchange: UNTP
ISIN: NGOANDO00002
(“Oando” or the “Company”)

Quote

 OANDO ENERGY RESOURCES EXECUTES BINDING LOAN AGREEMENT FOR ACQUISITION
                 OF NIGERIAN ASSETS FROM CONOCOPHILLIPS


CALGARY, ALBERTA January 31, 2014 – Oando Energy Resources Inc. (“Oando Energy
Resources” or the “Company”) (TSX: OER), a company focused on oil and gas exploration
and production in Nigeria, today announced that, further to its press release dated
October 10, 2013, it has entered into binding documentation for the following credit
facilities:

   (i)     a US$350 million corporate facility agreement with a syndicate of Nigerian
           lenders, as well as FBN Capital Limited and FCMB Capital Markets Limited, as
           Mandated Lead Arrangers, FBN Capital Limited as Facility Agent and Financial
           Modelling Bank, FCMB Capital Markets Limited as Technical Bank and First
           Trustees Nigeria Limited as Security Trustee (the “Corporate Facility”).

           The Corporate Facility will bear interest at an annual rate of LIBOR plus 9.5% for
           the first 57 months following the date of first drawdown and LIBOR plus 10.5%
           thereafter until the final maturity date of 72 months following the date of first
           drawdown. The Corporate Facility is an amortising loan, with interest and
           principal payable quarterly from the date of first drawdown until maturity; and

   (ii)    a US$450 million senior secured facility agreement arranged by a group of
           Nigerian and international banks including Standard Chartered Bank, BNP
           Paribas and The Standard Bank of South Africa Limited, Standard Chartered
           Bank acting as Facility Agent and Security Agent (the “RBL”).

           The RBL amortises quarterly from the first utilisation date and has a final
           repayment date of the earlier of the “Reserve Tail Date” (as defined in the RBL)
           and June 30, 2019. Interest is payable quarterly from the first utilisation date at
           an annual rate of LIBOR plus 8.5%.

The Company’s obligations under the Corporate Facility are guaranteed by certain
subsidiaries and affiliates of the Company. The obligations of the Company under the
Corporate Facility will be secured by (a) fixed and floating charges over the assets of the
Company and certain of its affiliates; (b) fixed charges over the shares of certain
subsidiaries and affiliates of the Company; and (c) a second ranking charge over the shares
of an indirect wholly-owned subsidiary of the Company (“Acquisitionco”) which will
acquire the shares of one of the companies pursuant to the Acquisition (as defined below).
                                           -2-



Proceeds from the Corporate Facility are intended to be used partially for payment of a
portion of the purchase price in respect of the proposed acquisition by Oando Energy
Resources of the Nigerian upstream oil and gas business of ConocoPhillips (the
“Acquisition”) with the remainder to be used to refinance other existing debt within the
Oando Energy Resources group.

The borrower under the RBL is Acquisitionco and its obligations under the RBL are
guaranteed by Oando Energy Resources, with the guarantee being subordinated to the
Corporate Facility. The obligations of Acquisitionco under the RBL will be secured by fixed
and floating charges over the shares and assets of Acquisitionco.

Proceeds from the RBL are intended to be used to fund a portion of the purchase price for
the Acquisition.

The Corporate Facility and RBL remain subject to certain conditions precedent to
drawdown.

Closing of the ConocoPhillips Acquisition remains subject to satisfaction of closing
conditions, including the anticipated consent of the Honourable Minister of Petroleum
Resources in Nigeria.

Forward Looking Statements:

This news release contains forward-looking statements and forward-looking information
within the meaning of applicable securities laws. The use of any of the words “expect”,
“anticipate”, “continue”, “estimate”, “objective”, “ongoing”, “may”, “will”, “project”,
“should”, “believe”, “plans”, “intends” and similar expressions are intended to identify
forward-looking information or statements. In particular, this news release contains
forward-looking statements relating to intended acquisitions.

Although the Company believes that the expectations and assumptions on which such
forward-looking statements and information are reasonable, undue reliance should not be
placed on the forward-looking statements and information because the Company can
give no assurance that such statements and information will prove to be correct. Since
forward-looking statements and information address future events and conditions, by
their very nature they involve inherent risks and uncertainties.

Actual results could differ materially from those currently anticipated due to a number of
factors and risks. These include, but are not limited to: risks related to international
operations, the actual results of current exploration and drilling activities, changes in
project parameters as plans continue to be refined and the future price of crude oil.
Accordingly, readers should not place undue reliance on the forward-looking statements.
Readers are cautioned that the foregoing list of factors is not exhaustive.

Additional information on these and other factors that could affect the Company’s
financial results are included in reports on file with applicable securities regulatory
authorities and may be accessed through the SEDAR website (www.sedar.com) for the
Company. The forward-looking statements and information contained in this news release
                                           -3-


are made as of the date hereof and the Company undertakes no obligation to update
publicly or revise any forward-looking statements or information, whether as a result of
new information, future events or otherwise, unless so required by applicable securities
laws.

Unquote


Lagos
3 February 2014

JSE Sponsor
Macquarie First South Capital Proprietary Limited

Contact Information:

Pade Durotoye, CEO
Oando Energy Resources Inc.
pdurotoye@oandoenergyresources.com
+1 403-561-1713

Tokunboh Akindele
Head Investor Relations
Oando Energy Resources Inc.
takindele@oandoenergyresources.com
+1 403-560-7450

Jeremy Dietz/David Feick
Investor Relations
+1 403-218-2833
jdietz@tmxequicom.com
dfeick@tmxequicom.com

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