Buccaneer Energy Limited (ASX:BCC) A$13.5 Million Institutional Placement, Now Fully Funded To Production

Sydney, July 4, 2011 AEST (ABN Newswire) - Buccaneer Energy Limited (ASX:BCC) is pleased to announce the placement of approximately 194 million ordinary shares to raise A$13.5 million from institutional and professional investors ("Institutional Placement").

The equity raising involved the placement of the 97 million share shortfall from the Share Purchase Plan ("SPP") and an additional placement of 97 million ordinary shares.

The SPP Shortfall and the additional placement were placed at an issue price of A$0.095 and A$0.045 per share respectively. Investors were required to subscribe for equal number of shares in the SPP Shortfall and the additional placement. As such the average price was A$0.07 per share.

Shareholder approval is not required for the Institutional Placement.

The equity raising will fully fund the company's onshore Kenai Loop project into production at the end of 2011. Upon the commencement of production from Kenai Loop #1 well, the Company is expected to achieve cash flow positive status.

The proceeds from the capital raising will be used as follows:

- Capital expenditure on pipelines and facilities to bring Kenai Loop # 1 well into production;

- Drilling and completion of Kenai Loop # 2 well, scheduled to commence this quarter;

- Buccaneer's equity contribution to the acquisition of the Jack-Up rig; and

- Working Capital and transaction costs.

Director of Buccaneer Energy, Dean Gallegos said:

"The equity raising was strongly sought after by institutional investors in Australia, New Zealand, Singapore and Hong Kong. Importantly, this marks the first occasion whereby Buccaneer has received funding support from institutional investors. Given the highly challenging market conditions, this is a testament to the quality of the Company's Alaskan Oil & Gas assets.

Buccaneer is committed to aggressively develop both its Alaskan onshore and offshore assets in order to realise value for our shareholders.

With the funds raised from the Institutional Placement, Buccaneer can now focus on implementing its strategy of being cashflow positive and in production by 1Q 2012."

Helmsec Global Capital Limited acted as Lead Manager of the capital raising.

Settlement of the above transactions is expected to occur on Friday 15th July 2011, with new shares under the Placement to be allotted on 18 July 2011. New shares will rank pari passu with existing shares.

Contact

Dean Gallegos Mob: +61-416-220-007 Tel: +61-2-9233-2520 http://www.buccenergy.com