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Reconnaissance Energy Africa, a Canadian firm engaged in oil exploration in the Kavango regions, recently announced to have surpasses fundraising goal , raises over US$7.4 million (approximately N$133 million) to continue its drilling campaign in kavango wells, Namibia, surpassing its initial target of US$6.5 million. The funds were raised through a private placement offering on the Toronto Stock Exchange but were sold outside of Canada. Notably, this funding comes shortly after ReconAfrica obtained a ministerial environmental clearance certificate (ECC) allowing them to drill 12 additional exploration wells. The validity of this latest ECC extends from July of the current year to July 2026.
The funds raised will be utilized by the oil company for various purposes, including site preparation for future drilling locations, maintenance of wellsite and rig, geologic and subsurface projects, geophysical processing, and working capital.
ReconAfrica also addressed rumors circulating among the locals, stating that these were baseless speculations. The rumors suggested that drilling activities had ended unsuccessfully, and there were concerns that the company might be winding down its local operations due to the absence of foreign workers at drilling sites.
According to a recent update from ReconAfrica shared with New Era, the company is currently in the process of interpreting the data obtained from completed exploratory drilling. This data analysis is crucial in determining the next drilling locations. The company plans to resume field operational activities once the next drilling campaign commences.
The Interpretation of the data involves integrating it with well data to create a comprehensive geological image. This integrated image will play a key role in guiding the project forward, including the construction of a prospect portfolio and identifying suitable locations for future drilling.
Moreover, the interpreted data is valuable in reducing the risks associated with exploration in vast areas like ReconAfrica’s licensed region. It allows the company’s team to prioritize prospective locations based on factors such as size, complexity, and geological probability.
Once the interpretation process is complete, ReconAfrica will create a geological model to further evaluate the sub-surface, develop the prospect portfolio, and determine the precise locations for the upcoming drilling activities, as stated in the recently-published update.
Cost of each units during fundraising of US$7.4 million for Kavango wells.
According to a statement by ReconAfrica, during the offering, each units were sold at a price of US$1.10 and a total of 6,795,454 units were sold. Each unit comprises one common share in the company’s capital and one common share purchase warrant. These warrants allow the holders to acquire one common share at a price of US$1.35 until 18 July 2025.
ReconAfrica’s spokesperson, Mwanyengwa Shapwanale, clarified the reason behind the absence of foreign workers at the company’s drilling sites, which had sparked speculative rumors in the surrounding communities. Shapwanale explained that the foreign workers had left Namibia after completing their work on the 2D seismic and eFTG (Enhanced Full Tensor Gravity) activities. These technical specialists are brought in as needed at different stages of the exploration program. The spokesperson emphasized that the 2D seismic and eFTG programs had reached their planned conclusion, and the company is currently in the process of integrating all of their sub-surface data. As ReconAfrica plans to resume drilling later this year, additional local and foreign workers will be required once again.
On another note, ReconAfrica has faced strong opposition from civil society organizations in Canada, the United States of America, and Namibia. These organizations have demanded that the Toronto Stock Exchange reject the company’s regulatory approval. Lorne Stockman from Oil Change International expressed concerns, stating that ReconAfrica’s drilling program should not be happening as it poses a threat to one of the world’s richest ecosystems and goes against climate science. |
