DECA

Clearance by Takeover Panel

White Nile Limited 19 May 2005 White Nile Limited / Epic: WNL / Market: AIM / Sector: Oil & Gas White Nile Limited ("White Nile" or "the Company") 'Clearance by Takeover Panel' In 2004, the prospective Government of Southern Sudan ("GOSS") granted its national oil company, Nile Petroleum Corporation Limited ("NPC"), a concession to explore and develop hydrocarbon interests in Block Ba, which contains part of the Muglad basin in Southern Sudan ("the Concession"). It has previously been announced that White Nile is to acquire an interest in the Concession ("the Acquisition"). Full details of the Acquisition are included in the circular to the shareholders of White Nile which will be despatched on 19 May 2005. The Acquisition is subject to the approval of shareholders at an Extraordinary General Meeting to be held on 16 June 2005. Under the terms of the Acquisition, the Company is entitled to 60% of the gross revenues generated from the Concession in return for bearing 100% of the costs of exploration, development and production, subject to being entitled to a minimum annual internal rate of return on capital of 40%. In consideration for the Acquisition, GOSS via NPC will receive 155,000,000 ordinary shares of 0.1p each in the Company ("the NPC Shares") which will represent 50% of the enlarged share capital of White Nile. NPC will also have the right to appoint two members to the board of White Nile and as the holder of 50% of White Nile's share capital could potentially dictate the future composition of the Board and the direction of the Company. NPC will also have an option to transfer its remaining interest in the Concession to White Nile in return for the issue of a further 206,666,667 ordinary shares in the Company (" the NPC Option Shares") such that, depending on the timing of further equity fundraising by White Nile, NPC's holding could rise to 70%. If NPC exercises this option it will have the right to appoint a further director to the board. NPC was incorporated in Yei, Southern Sudan, on 22 July 2004 with company number 196. It is wholly owned by the GOSS. The directors of NPC are Bullen Bol, Kuol Manyang Juuk and Simon Kun Puoch. Sudan is essentially governed by two governments: Northern Sudan is governed by the National Islamic Front and Southern Sudan, where the Concession is located, is governed by the Sudan People's Liberation Movement who formed the GOSS. Doctor Riek Machar is the Prime Minister of the GOSS and he chairs the leadership council comprising around 7 members who represent different tribal groups. NPC director Kuol Manyang Juuk is a member of the leadership council. The managing director of NPC, Bullen Bol, reports to the Minister of Energy, who in turn reports to the leadership council. It is not yet known which representatives of NPC or the GOSS will be appointed to the board of White Nile Limited, though such appointments are subject to their meeting the requirements of the London Stock Exchange. The appointments will be determined by the directors of NPC at the direction of the leadership council. The directors have received irrevocable undertakings from shareholders representing more than 99% of the issued share capital of the company to vote in favour of the resolution approving the Acquisition. Once the Acquisition is completed White Nile will become a company controlled, at shareholder level, by the GOSS who will hold 50% of the voting shares. As far as the board of directors is concerned, Phil Edmonds, Andrew Groves and Brian Moritz will continue to be directors and in due course NPC may appoint two directors. As noted above, at present the names of the directors that the GOSS may choose to appoint to White Nile and the extent to which it will seek to exert executive influence over White Nile is not known. The UK City Code on Takeovers and Mergers ("the City Code") applies to public companies which are resident in the United Kingdom, the Channel Islands or the Isle of Man and therefore applies to the Company. Under Rule 9 of the City Code a party acquiring a holding of 30% or more of a company's voting rights is normally obliged to make a general offer to all other shareholders to acquire the shares not held by them. Rule 9 of the City Code also states that if any person or group of persons acting in concert holds not less than 30%, but not more than 50% of the voting rights of such a company a general offer will normally be required if any further shares are acquired. An offer under Rule 9 must be in cash and at the highest price paid within the preceding twelve months for any shares in the company by the person required to make the offer or any person acting in concert with him. Following completion of the Acquisition, NPC, which previously held no Ordinary Shares, will hold 50% of the enlarged issued share capital of the Company. In the event that NPC exercises the Option, it is possible that its holding in the Company will be increased to 70%. The requirement for a general offer will normally be waived if the independent shareholders pass a resolution ("a whitewash resolution") approving such a waiver. The Takeover Panel also has the power to waive the requirement for a general offer to be made where independent shareholders representing more than 50% of the shares of the company which would be eligible to vote on a whitewash resolution irrevocably undertake to vote in favour of a whitewash resolution, were one to be put to shareholders. The directors have received irrevocable undertakings of this nature from independent shareholders representing more than 50% of the shares of the Company and accordingly the Takeover Panel has waived the requirement for a general offer to be made by NPC either following the issue by the Company of the NPC Shares or following the issue by the Company of the NPC Option Shares. Following the appointment of NPC's two representatives to the Board of Directors, the operations of the Company will be carried on from Southern Sudan, the Company's principal place of business will be in Southern Sudan and the majority of Directors will be resident outside the United Kingdom, Channel Islands and the Isle of Man. Accordingly, the City Code will not apply to the Company after such appointments on the basis that it will then no longer be managed in the United Kingdom, the Channel Islands or the Isle of Man. In these circumstances, NPC will be able to acquire further shares without triggering an obligation to make a mandatory offer under Rule 9 of the City Code, irrespective of the size of NPC's holding. Upon the appointment by NPC of its two representatives to the Board of Directors an announcement will be made to this effect. * * ENDS * * Enquiries concerning this announcement should be directed to: Phil Edmonds White Nile Limited, 18 Upper Brook Street , London, W1K 7PU Tel: 0845 108 6060 Hugo de Salis St Brides Media & Finance Ltd, 46 Bedford Row, London, WC1R 4LR Tel: 020 7242 4477 Paul Gray or Jeff Ward Numerica Capital Markets Limited, 66 Wigmore Street, London, W1U 2HQ Tel: 020 7467 4000 This information is provided by RNS The company news service from the London Stock Exchange