ReconAfrica Announces C$20 Million Overnight Marketed Offering to Advance Multi-Zone Production Testing at Kavango West 1X, Accelerate Follow-on Appraisal Drilling on Kavango Discovery and Advance Activities at Ngulu Block in Gabon
Executive Summary
- ReconAfrica announced a C$0.95 per Unit private placement targeting gross proceeds of C$20 million, led by Research Capital Corporation with Canaccord Genuity and Haywood Securities as co‑underwriters.
- Each Unit consists of one common share plus half of a warrant (exercise price C$1.20, exercisable for 36 months); underwriters receive cash fees and broker warrants equal to 6% of the gross proceeds.
- Net proceeds will fund production testing at Kavango West 1X, advance appraisal drilling in Namibia, seismic re‑processing and resource work on the Ngulu block (Gabon), and general corporate purposes.
Key Details
- Offering Structure:
- Price: C$0.95 per Unit
- Units: Common share + ½ warrant (exercise price C$1.20, 36‑month term)
- Gross proceeds target: C$20 million
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Over‑allotment option: up to an additional 15% of Units
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Underwriters: Research Capital Corporation (lead bookrunner), Canaccord Genuity Corp., Haywood Securities Inc.
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Management/Director Participation: Certain insiders and “president’s list” investors will participate; treated as a related‑party transaction under MI 61‑101, expected to remain below 25% of market cap.
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Use of Proceeds:
- Install production casing & conduct extensive production test at Kavango West 1X (depth to 4,260 m, up to eight intervals).
- Advance pre‑drill operations for a Kavango appraisal well to drill‑ready status and permit work.
- Re‑process 3D seismic on the Loba discovery (Ngulu block, Gabon) to support a resource report and drill‑ready appraisal well.
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General corporate purposes & working capital.
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Closing: Expected around January 19, 2026, subject to regulatory approvals; Units will be free‑trading immediately after closing.
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Agent Compensation: Cash fee equal to 6% of gross proceeds plus broker warrants covering 6% of total Units issued (exercise price C$0.95, 36‑month term).
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Corporate Updates Included:
- Production test strategy for Kavango West 1X (cased‑hole test, up to eight intervals).
- Planned appraisal well selection and permitting in Namibia.
- Upcoming geochemical sampling and potential 2D seismic in Angola’s MOU area (field work slated for April 2026).
- Ongoing seismic re‑processing and resource evaluation on Gabon’s Ngulu block, with plans to advance the Loba field appraisal well.
Notable Quotes
- Brian Reinsborough, President & CEO: “This equity raise will fund our 2026 capital program, the most comprehensive and diverse program in ReconAfrica’s history… advancing our Kavango discovery toward commerciality and progressing the Loba discovery to a drill‑ready state.”