Bandanna Energy Limited (ASX:BND) Status Update: Wiggins Island Port and Bowen Basin Developments

Brisbane, Dec 2, 2011 AEST (ABN Newswire) - Bandanna Energy Limited (ASX:BND) provides the following update on its activities.

Key Points

- Wiggins Island Coal Export Terminal (WICET) Stage 1 construction at Gladstone, in which Bandanna is a 14% owner shareholder and has a 4 Mtpa allocation, remains on schedule for first export coal in mid 2014.

- Yesterday's ASX release concerning the South Galilee Coal Project Joint Venture's failure to gain Preferred Status (in which Bandanna has a 50% interest) for 15 Mtpa of port allocation at Abbot Point, has NO bearing on the Wiggins Island, 4 Mtpa WICET allocation of Bandanna, nor on the current construction and development schedules of WICET. WICET's Gladstone port facilities will provide port access to Bandanna's Bowen Basin located source mines and not those of any future mine development in the Galilee Basin.

- Planned expansion of Abbot Point and the EOI sought for a 15 Mtpa coal export allocation in that proposed T4-T9 expansion relates solely to optionality for future port solutions by the South Galilee Project JV in the Galilee Basin and NOT to Bandanna's major Bowen Basin projects.

- At the invitation of Northern Queensland Bulk Port (NQBP) authority, representatives of the South Galilee Coal Project Joint Venture (including Bandanna) will meet with NQBP early next week in order to discuss other options for securing capacity at the T4-T9 Abbot Point Expansion through nominated Preferred Respondents.

- Following a capital raising in August 2011 and, with approximately $130 million in cash, Bandanna remains fully funded to meet all of its obligations to the WICET port and corresponding rail including bank guarantees for $52 million under the agreement with WICET and $15.3 million to QRN. Bandanna will make no further capital contributions for the proposed WICET port funding under the $2.5 billion privately funded financing package of senior and subordinated debt arranged by ANZ bank.

- Exploration and resource/reserve delineation drilling for Bandanna's WICET Stage 1 source mines in the Bowen Basin remain on target, with drilling continuing in the Springsure Creek and Dingo West tenements.

- Likewise, Environmental Impact Studies for Arcturus, Springsure Creek, Dingo West and South Galilee Basin projects remain on target.

- As announced at the recent AGM Bandanna will shortly be moving into larger offices in order to accommodate its increasing activities, and in particular those related to its on-going Bankable Feasibility Studies for its Bowen Basin Springsure Creek and Dingo West projects.

- Bandanna is in discussions with a number of parties concerning farmins, and the formation of joint ventures, in key Bowen Basin projects in order to provide project funding solutions for major project capital expenditure.

- Announcement of a new CEO reflecting the transition of the Company into its current development phase is expected shortly.

Contact

Dr Ray Shaw Tel: +61-7-3041-4400 Andrew Crook Mb: +61-419-788-431