Harare (New Ziana) – Invictus energy on Monday said it has secured US$12 million via a private placement of ordinary shares to fund the drilling of the first exploratory well in Muzarabani where it is prospecting for oil and gas.
Proceeds from the placement will be deployed as follows: drilling US$9 million, working capital-US$2. million and capital raising fees US$0.7 million.
In an update, Invictus said under the placement, the company issued 60 026 165 new fully paid ordinary shares at an issue price of $0.20 per new share.
“The placement saw participation from multiple new and existing institutional investors ahead of the company’s upcoming drilling campaign at its 80 per cent owned and operated Cabora Bassa Project in Zimbabwe and was strongly supported with demand significantly exceeding shares available. The first well in the campaign will target the Mukuyu prospect, which has been independently estimated to contain 8.2 trillion cubic feet + 247 million barrels of conventional gas-condensate,” the company said.
Invictus has contracted Exallo Drilling to provide the drilling services while American company Baker Hughes was tied up for well services which include cementing, drilling fluids, tubular running, installation of wellhead equipment and project management.
Pre-drilling activities commenced early this month with the construction of the site for the exploratory well, dubbed the Mukuyu.
Drilling is expected to start in July this year as the company enters a crucial phase in the development of the prospect.
Commenting, managing director Scott Macmillan described the impending drilling as an exciting phase for the company.
“Through the completion of this capital raise, in conjunction with our existing cash balance and additional funds delivered via the exercise of in-the-money options, the company is well funded for the Mukuyu-1 well,” he said.
“We have a number of catalysts in the lead up to the basin opening drilling campaign including an update to the prospect and lead inventory encompassing the expanded SG 4571 licence area, selection of the second well location to follow on from Mukuyu-1, and the mobilisation of the Exalo 202 drilling rig. Drilling of the Mukuyu-1 well, which will test Africa’s largest undrilled onshore oil and gas prospect, remains on track to commence in July.”
American company Mobil once did limited exploration work in the area in the 1980s which excluded drilling.
In 2020, the Zimbabwe government classified the Muzarabani project as one of the priority development projects which would aid the country’s pursuit of its economic development agenda.
Zimbabwe is aiming to transform into an upper-middle Income economy by 2030.