Loan Agreement

5 June 2015

IPSA Group PLC

("IPSA" or the "Company")

Loan Agreement

IPSA, the AIM and Altx dual listed independent power plant developer with operations in southern Africa, today announces that its subsidiary, Newcastle Cogeneration Pty. Limited ("NewCogen"), has commenced drawdown of a loan facility granted by the Industrial Development Corporation of South Africa Limited ("IDC").

The aggregate sum of the IDC loan facility is ZAR 15.4m (£817,000). The loan is repayable in 48 monthly instalments from 1 April 2016 and the interest rate is South African Prime Overdraft less 2%, currently 7.25 per cent per annum. The funds will be used to repay indebtedness at the NewCogen level and to pay the final costs of installing the two Jenbacher engines which add some 4 MW of new capacity on site.

Works to install the engines will commence later this month and the planned commercial operation date is the early September 2015. Once the engines enter service, output will be sold under the newly extended MTPPP power purchase contract with Eskom.

The Company's working capital remains tight and is being carefully managed until the expected receipt of the remaining balances owed by Rurelec plc from the sale of turbines.

Commenting today, Peter Earl, Acting CEO of IPSA, said: "We are very pleased that the IDC is now supporting us in the expansion of the plant at Newcastle. We hope that this will be the first step in IPSA's return to expansion of power generation capacity in South Africa."

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