Candax Energy Inc.

Candax Energy Inc.

August 29, 2005 08:13 ET

Candax Announces Exchange of Subscription Receipts and Listing of Common Shares and Warrants

TORONTO, ONTARIO--(CCNMatthews - Aug. 29, 2005) -

Not for distribution to United States newswire services or for dissemination in the United States.

Candax Energy Inc. ("Candax") (TSX:CAX)(TSX:CAX.W) is pleased to announce that it has received a receipt from the applicable securities regulatory authorities in Canada for a prospectus of Candax dated August 22, 2005 (the "Prospectus") which, among other things, qualified the distribution of the common shares and warrants of Candax issuable upon the exchange of certain subscription receipts of Candax (the "Subscription Receipts"). The common shares and warrants of Candax will commence trading on the Toronto Stock Exchange at the opening on Monday, August 29, 2005, under the symbols CAX and CAX.W respectively. Each warrant entitles the holder thereof to acquire one common share of Candax at a price of $1.20 until 5:00 p.m. (Toronto time) on April 14, 2006, subject to adjustment. The distribution of the common shares and warrants of Candax issuable upon the exchange of the Subscription Receipts is more particularly described in the Prospectus.

Actis Africa Fund 2, LP now holds 37,500,000 common shares and 18,750,000 warrants of Candax Energy through the exchange of Subscription Receipts (as disclosed in the Prospectus) and as such it exercises control or direction over an aggregate of 37.5 million common shares of Candax (or 56.25 million common shares assuming the exercise of the warrants), which represent approximately 28.7% of the outstanding Candax common shares (or 30.3% on a fully-diluted basis assuming all warrants and options are exercised). Actis Africa Fund 2, LP is managed by Actis Capital LLP, a leading private equity investor in emerging markets. Although Actis may make further purchases of common shares of Candax on the Toronto Stock Exchange or through private purchases, such purchases will be made for investment purposes.

Michael Wood, Candax's President & CEO commented "I am pleased to take this opportunity to thank all the investors who have backed Candax and to re-confirm our commitment to continue to use our talents and resources to deliver on our primary goal -- to achieve outstanding growth and shareholder value for our investors. From the inception of Candax as an international upstream corporation less than a year ago, we have already set in-place much of the groundwork required to deliver on this goal. We are currently finalizing our 2005 fourth quarter plans to commence development drilling in Tunisia, which we believe may add substantially to our production. Plans are also underway to begin the exploration / appraisal of the hydrocarbon potential of the Chaal permit."

Candax Energy Inc. is an international energy company with its head office in Toronto, Ontario, Canada and management offices in London, Dubai and Tunis. The Company produces approximately 1,800 boe/d from its subsidiary operations in Tunisia. Candax was formed through the combination of a highly experienced executive management team with successful Canadian founders and financiers, to develop an international upstream oil and gas project portfolio. Candax is initially focusing its growth activities on production and development projects in the Middle East and North Africa, where the group has strong relationships as well as extensive management experience.

Certain statements in this News Release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Corporation to be materially different from any future results, performance or achievements expressed or implied by such forward looking statements.

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