The Base Shelf Prospectus is accessible, and the Prospectus Supplement will be accessible within two business days, through SEDAR+
Reconnaissance Energy Africa (ReconAfrica) has entered into an agreement with Research Capital Corporation as the lead underwriter and sole bookrunner, on behalf of a syndicate of underwriters, including Canaccord Genuity Corp. and Haywood Securities Inc. (collectively, the 'Underwriters'), for an overnight marketed public offering of units of the Company at a price of C$0.50 per Unit for aggregate gross proceeds to the Company of C$10,000,000.
In connection with the Offering, indications of lead orders have been received from BW Energy, directors and management members of ReconAfrica, and certain other investors, expecting to purchase over C$4,000,000 of Units. BW Energy has agreed to a follow-on strategic equity investment in the Company of approximately C$2,000,000 under the Offering, reaffirming it's previously announced strategic partnership with ReconAfrica. BW Energy's additional investment represents approximately 20% of the Offering, increasing BW Energy's share ownership position in ReconAfrica from approximately 6.5% prior to the Offering to approximately 7.6% after the Offering. The Units purchased by BW Energy under the Offering will be subject to a six-month lock-up agreement.
The net proceeds from the Offering will be used for exploration activities, working capital and general corporate purposes. The primary exploration activity to be funded with net proceeds from the Offering will be the drilling of Prospect I, which has been named the Kavango West 1X well. Work on the access road and drill site is currently being completed while the Company awaits receipt of the remaining requisite permits. The rig move to the Kavango West 1X well drilling location is scheduled in late June, with drilling to begin thereafter.
Brian Reinsborough, President and CEO of ReconAfrica stated: 'We are excited to spud one of the Company's largest and most attractive prospects, Kavango West 1X. The results of the Naingopo exploration well announced in January 2025 increased our confidence in the potential for this well. Our teams remain very engaged with local communities and authorities to ensure a safe and efficient operation of this well.'
Carl K. Arnet, BW Energy CEO commented: 'Our technical and operational teams at BW Energy are delighted to be participating in the high potential Kavango West 1X exploration well. BW Energy is well positioned in this strategically important energy region and further our position as a leader in Namibia's development towards energy independence. The data and insights gained through ReconAfrica's exploration campaign will further our understanding of the geology and petroleum system in Namibia and help de-risk planned exploration and development of our Kudu licence.'
Kavango West 1X (Prospect I) - High Potential Exploration well
The Kavango West 1X exploration well will be the second test in the expansive Damara Fold Belt play. The prospect is a large fold identified on modern 2D seismic data which extends over 20 kilometers long by 5 kilometers wide, and is expected to penetrate a thick Otavi carbonate reservoir section, which is the primary target in the play. The Kavango West 1X well will be drilled to a planned total depth of approximately 3,800 metres (12,500 feet) and is targeting 346 million barrels of gross unrisked (30 million barrels of gross risked) prospective light/medium crude oil resources on a 100% working interest basis (312 million barrels(1,2) net unrisked (27 million barrels net risked) to ReconAfrica's 90% working interest as at the date of the NSAI report) or 1,839 billion cubic feet of gross unrisked (133 Bcf risked) prospective natural gas resources on 100% working interest basis (1,655 billion cubic feet(1,2) unrisked net (120 Bcf risked net) to ReconAfrica's 90% working interest as at the date of the NSAI report), based on the most recent prospective resources report prepared by Netherland, Sewell & Associates, Inc. ('NSAI') as at December 31, 2024, filed on SEDAR+ at www.sedarplus.ca (the 'NSAI Report')(1).
Damara Fold Belt Play Across 11.5 Million Acres in Namibia and Angola
The Damara fold belt trend is identified in the subsurface by a grid of 2D seismic data, and the Company has mapped 19 prospects and 4 leads on the Namibia side of the play. The Namibia area is estimated to hold 2.6 billion barrels(1,2) of unrisked prospective light/medium crude oil resources and 157 million barrels(1,2) of risked prospective light/medium crude oil resources from the Damara Fold Belt play prospects on PEL 73.
(1) There is no certainty that any portion of the resources will be discovered. If discovered, there is no certainty that it will be commercially viable to produce any portion of the resources. Prospective resources are those quantities of oil estimated, as of a given date, to be potentially recoverable from undiscovered accumulations by application of future development projects. Prospective resources have both an associated chance of discovery and a chance of development. Prospective resources are the arithmetic sum of multiple probability distributions. Unrisked prospective resources are estimates of the volumes that could reasonably be expected to be recovered in the event of the discovery and development of these prospects.
(2) Not reflective of ReconAfrica's current working interest of 70% of PEL 73.
Recently, the company has entered a Memorandum of Understanding (MOU) with National Agency for Petroleum, Gas and Biofuels of Angola (ANPG) for a joint exploration project in the Etosha-Okavango basin, located onshore in southeastern Angola. This agreement is a strategic addition to the company's asset portfolio, which creates an opportunity for early entry into onshore Angola at a low cost, with minimal work commitments. It complements ReconAfrica's activities in Namibia and highlights the potential of the Damara Fold Belt and Rift Basin by adding 5.2 million contiguous acres in Angola to the existing 6.3 million acres in Namibia in the Damara Fold Belt and Rift Basin exploration plays.
NOTE: ReconAfrica has subsequently published the following update to the above press release: ReconAfrica Announces Upsize of Underwritten Offering to C$16.5 Million
Source: ReconAfrica
