With South Africa facing an energy crisis, increasing shortages of electricity and upheaval in its industry and investment, oil and gas developments are the nation’s need of the hour. The aging coal-fired power plants are retiring, which translates to an urgent need of transition from gas to power to quench the regional power needs.
However, there appears to be not one, but two silver linings- Firstly, the pro-business region of Zimbabwe where the new government is not only promoting foreign investment but has implemented investor-friendly reforms like the Indigenization and Empowerment Act and SEZ legislation.
Secondly, independent oil and gas explorer Invictus Energy Limited (ASX:IVZ) which is thriving to attain the early entry advantage in the region. The junior explorer, a first mover in the strategic and industrialised location of Zimbabwe has secured the best acreage, best terms and has a probable exposure to the most lucrative markets through its 80% owned and operated Cabora Bassa Project.
The Company recently intimated about the updates on the activities at the Project-
Zimbabwe Government Ministries & Stakeholders Meetings- PSA & Petroleum Act
In the last few weeks, the Company made presentations and conducted meetings with several Zimbabwe Government Ministries and stakeholders, including Minister of Energy and Power Development, Minister of Mines and Mining Development and the Mining Affairs Board. Moreover, it met the Chiefs representing the Muzarabani and Mbire Rural Districts in the Cabora Bassa project area.
IVZ and the Government of Zimbabwe has collectively made significant progress with the legal and fiscal framework. These include-
- Amendments to the Petroleum Act
- Execution of a Production Sharing Agreement (PSA) between Geo Associates (Private) Limited and the Republic of Zimbabwe
The Government of Zimbabwe has setup a Technical Committee to undertake negotiations for a PSA, which is chaired by the Secretary for Finance and Economic Development. Members include-
- Officials from the Reserve Bank of Zimbabwe,
- The Permanent Secretaries for Mines and Mining Development and Energy and Power Development
- Zimbabwe Investment and Development Agency Office of the President
- Cabinet Office of the Attorney General
- Local Government and Public Works
The Committee’s first meeting was held last week. A press conference was held post the meeting with the Minister of Mines and Mining Development to discuss the project developments.
IVZ has been invited to make a presentation prior to the end of March. Along with its attorneys, IVZ has been working diligently with the legal representatives from the Ministry of Mines and Mining Development and Ministry of Energy and Power Development on the PSA.
The PSA, likely to be concluded shortly, is expected to provide a stable and transparent legal and fiscal framework for the exploration and production of oil and gas in Zimbabwe.
Muzarabani and Mbire Rural Districts Chiefs Meetings
IVZ was hosted by the District Administrator for Mashonaland Central Province in Centenary. It was received by the Chiefs representing the Muzarabani and Mbire Districts.
In these meetings, IVZ presented an overview and update of the project to the Chiefs and intimated them about the upcoming ground activity that will commence following the approval of the Environmental Impact Assessment (expected shortly).
To know about the EIA Progress, READ HERE- Invictus Energy Declares December Quarter Results; Significant Progress at Cabora Bassa Project
The Chiefs expressed their support towards the Project, and subsequently have planned a Cultural Ceremony to welcome IVZ to the community, demonstrating the optimism and enthusiasm for the upcoming exploration programme.
The IVZ stock last quoted $ 0.011 on 17 March 2020 (4:07 PM AEDT).
It will be interesting to watch the Company unfolding its activities in the lucrative acreage and gauge Project developments likely to appease the shortage of gas situation in South Africa.
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