ReconAfrica increases private placement to $32-million

Executive Summary

• Reconnaissance Energy Africa Ltd. has upsized its previously announced private placement offering to raise C$32.0 million in gross proceeds due to strong investor demand.
• The capital raise is designated to accelerate multi-zone production testing at the Kavango West 1X well in Namibia, advance appraisal drilling at the Kavango discovery, and fund activities at the Ngulu Block in Gabon, including seismic reprocessing for the Loba discovery.
• The offering includes an overallotment option for up to 15% additional units, with closing expected on or around January 19, 2026.

Key Details

• Offering Size & Price: The offering was upsized to 33,684,300 units at a price of C$0.95 per unit, resulting in aggregate gross proceeds of $32,000,085.
• Underwriters: Research Capital Corp. is the lead underwriter and sole bookrunner, with Canaccord Genuity Corp. and Haywood Securities Inc. as part of the syndicate.
• Unit Structure: Each unit consists of one common share and one-half of one common share purchase warrant.
• Warrant Terms: Each warrant allows the purchase of one common share at an exercise price of $1.20, exercisable for 36 months from closing. The company intends to list these warrants on the TSX Venture Exchange.
• Overallotment Option: Underwriters have an option to purchase up to an additional 15% of units (approx. 5,052,645 units) to cover overallotments, exercisable up to two business days prior to closing.
• Use of Proceeds:
  • Conducting extensive production testing and installing production casing at the Kavango West 1X discovery well.
  • Advancing predrill operations to drill-ready status for the Kavango appraisal well.
  • Reprocessing seismic data at the Loba discovery and exploration inventory on the Ngulu Block in Gabon to advance toward a resource report and drill-ready status.
  • General corporate purposes and working capital.
• Underwriter Compensation: The underwriters receive a cash fee of 6% of gross proceeds (including overallotment) and broker warrants equal to 6% of the aggregate number of units issued. Broker warrants have an exercise price of 95 cents and a term of 36 months.
• Insider Participation: Management, directors, and president's list investors are participating in the offering. This is treated as a related party transaction, relying on exemptions from formal valuation and minority shareholder approval requirements as insider participation will not exceed 25% of market capitalization.
• Closing Date: Expected on or about January 19, 2026, subject to regulatory approvals.
• Regulatory Basis: The offering is conducted under the Listed Issuer Financing Exemption (NI 45-106) in all Canadian provinces except Quebec and qualifying US jurisdictions. Units will be free-trading upon closing.

Notable Quotes

• "This offering sets out to finance that multipronged 2026 capital program."
• "As a result of the extensive section of hydrocarbons, the company plans to test up to eight intervals."
• "This appraisal well will be a critical step toward a final investment decision (FID)/commercialization."