Reconnaissance Energy Africa Ltd has raised C$21.9 million (N$254 million) through a bought-deal public offering. The company will use the funds to carry out a horizontal sidetrack and production testing program at the Kavango West 1X well in Namibia.
The Canadian oil and gas company completed the offering by selling 29.93 million units at C$0.73 each. The underwriters also exercised their full over-allotment option, bringing the total gross proceeds to C$21.85 million.
ReconAfrica will use the funds to drill an open-hole horizontal sidetrack and conduct production tests targeting the primary reservoir in the Huttenberg Formation and/or the secondary reservoir in the Elandshoek Formation.
The company will use the remaining funds for general corporate activities and working capital.
Each unit included one common share and half of a common share purchase warrant. Each full warrant allows the holder to purchase another common share at C$0.93 until 10 September 2029.
The warrants are expected to start trading on the TSX Venture Exchange under the company’s proposed symbol, subject to final approval from the exchange.
Research Capital Corporation acted as lead underwriter and sole bookrunner for the offering. Canaccord Genuity Corp. and ATB Cormark Capital Markets also joined the underwriting syndicate.
ReconAfrica paid the underwriters a C$1.28 million cash commission and issued 1.76 million broker warrants. The underwriters also received a C$15,000 advisory fee and 6,000 advisory warrants.
ReconAfrica holds petroleum licenses and access to about 13 million contiguous acres across the Damara Fold Belt and Kavango Rift Basin in northeastern Namibia, southeastern Angola, and northwestern Botswana.
The company also operates the 1,214-square-kilometer Ngulublock in the shallow waters off central Gabon. The block includes the Loba oil field discovery and several other exploration prospects.
source: observer24.com.na
African Energy Council