Invictus Energy secures $15.2m backing for development of Cabora Bassa project in Zimbabwe

By Agencies

Invictus Energy has found major backing for its plans to develop the Cabora Bassa project in Zimbabwe – considered one of the biggest recent onshore discoveries in southern Africa.

The Australian junior is to receive approximately $15.2 million in support for its development plans after entering into a binding share subscription offer with Mangwana Capital.

The placement will be partially underwritten by the Mutapa Investment Fund of Zimbabwe.

Two-tranche placement

The placement will be carried out in a two-tranche private placement, with tranche one to raise approximately $11.4m.

Tranche two will comprise an additional approximately $3.8m.

Invictus has reserved the right to accept oversubscriptions of up to approximately $7.6m at its absolute discretion, with any oversubscriptions taken to settle in tranche two.

Strategic value

Managing director Scott Macmillan said participation of the Mutapa Investment Fund (the sovereign wealth fund of Zimbabwe) adds further strategic value as the country’s nominated participant in the future development of the Cabora Bassa project through the Petroleum Production Sharing Agreement (PPSA).

He said Mutapa’s participation signifies the government of Zimbabwe’s commitment and alignment to Cabora Bassa.

“Mutapa’s investment is a strong endorsement of the Cabora Bassa Project and recent significant gas-condensate discoveries delivered from Mukuyu-2,” Mr Macmillan said.

“Our partnership with Mangwana continues to assist the company advance key objectives in-country and provide exposure for local investors to our world-class Cabora Bassa project.”

Transparent commitment

Mr Macmillan said the Zimbabwean government’s commitment through the PPSA provides a solid foundation for a transparent and stable operating environment, crucial for the successful phased and ultimate full-field development of Cabora Bassa.

He added that the company’s farmout process to secure a strategic partner continues to progress well with active discussions advancing with multiple parties.

The company will utilise placement proceeds to progress the Cabora Bassa project including a flow test of the Mukuyu-2 well and early monetisation studies, purchase of long-lead items for exploration wells and general working capital.

The company is nearing completion of the well test design study and contract negotiations for the provision of well services and equipment.

Licence extension

Invictus was recently successful in renewing the licence covering its Mukuyu discovery.

The three-year extension will now provide Invictus with the time to step up its evaluation of Mukuyu and the surrounding region and to further cement development and gas marketing opportunities.

The company plans to undertake a comprehensive work program for the final year of the 3-year exploration period, including 3D seismic acquisition and additional exploration/appraisal drilling.