OREANDA-NEWS. December 10, 2014. Blue Sky Power Holdings Limited  (or "the Company", together with its subsidiaries, the "Group", HKSE stock code: 6828) is pleased to announce that the Company entered into a Memorandum of Understanding ("MOU"), to invest in Triple Energy Limited ("Triple"), a company listed in ASX and holding a coal bed methane gas project in Heilongjiang, the PRC.

According to the MOU, Waypost Limited ("Waypost"), a 60%-owned subsidiary of the Company, agreed to subscribe 158,000,000 Tranche 1 Placement Shares, representing approximately 19.90% of the issued share capital of Triple Energy Limited after the completion of the Placement. The total consideration is AUD790,000 at a price of approximately AUD0.005 per Triple Share.

In respect of provision of loan, Waypost agrees to lend CFT Heilongjiang (HK) Limited ("CFT"), a wholly-owned subsidiary of Triple, the loan of AUD500,000, which is convertible into 83,333,333 new Triple Shares at a price of AUD0.006 per Triple Share.

Triple proposes to conduct a further placement of 333,333,333 Tranche 2 Placement Shares at AUD0.006 per Tranche 2 Placement Share under the Tranche 2 Placement. Waypost, the Company and Triple will enter in the Underwriting Agreement, pursuant to which, Waypost will underwrite 208,333,333 Tranche 2 Placement Shares under the Tranche 2 Placement, and 125,000,000 Tranche 2 Placement Shares shall be reserved for the existing shareholders of Triple (excluding the Waypost).

Waypost shall also procure a Drilling Company to perform Drilling Services for Triple at a consideration of not more than USD2,750,000. The payment of the entire amount shall be satisfied by the issue of up to 525,401,250 new Triple Shares at a price of AUD0.006 per Triple Share to Waypost for the Procurement.

Upon completion of the Tranche 1 Placement, the conversion of the Loan into 83,333,333 new Triple Shares, the Tranche 2 Placement and the Drilling Services to be performed, Waypost shall own up to 975,067,916 Triple Shares, representing approximately 56.17% of the issued share capital of Triple. The Company shall indirectly own 33.70% of the issued share capital of Triple and Triple will become an associate of the Company.

Triple Energy limited is an Australian registered oil and gas exploration company listed on the Australia Stock Exchange (ticker: TNP). Through its wholly-owned subsidiary CFT, Triple has 80% interest in a coal bed methane gas project and a Cooperative Joint Venture, Heilongjiang Aolong Energy Co. Ltd. with Longmay Group, one of the largest state-owned coal mining enterprises in the PRC, holding the remaining 20% profit interest.

Heilongjiang Aolong Energy Co. Ltd. operates pursuant to the coal mining and exploration leases held by Longmay Group in areas such as Hegang mines, Shuang Ya Shan mines, Qi Tai He mines and Yixi mines in Heilongjiang Province under the joint venture agreement registered with the relevant government authority in the PRC. The Cooperative Joint Venture intends to focus on the Hegang mines first in view of its expected significant potential volumes of coal bed methane gas in such area.

In July 2013, the first drill stem test well was drilled in the Hegang mines and the evaluation of the drilling result showed that there existed excellent potential for further development. According to Triple, the Hegang mines covered an area of 210km and based on the preliminary technical assessment, the potential volumes of coal bed methane gas in Hegang mines is amounted to be up to 534 billion of cubic feet.

Mr. Tommy Cheng, Chairman and Executive Director of Blue Sky Power Holdings Limited, said, "The Company proposes to enter into the MOU in order to further establish our market presence and strengthen our existing business portfolio of natural gas business operations in the PRC. It will be complementary to the existing business model of the Company, which can result in a vertical integration of the natural gas business and provide certain natural gas sources by ourselves from the gas resources of the Hegang mines."