- Independent oil and gas explorer, Invictus Energy Limited (ASX:IVZ) provided an update of its activities for the quarter ending September 2020.
- The Company made significant development, advancing its 80% owned and operated Special Grant 4571 licence (Cabora Bassa Project).
- Invictus witnessed licence renewals, EIA approval, a strategic placement, PSA negotiation progress, advancing farm out process and field operations in the Cabora Bassa Basin.
- In due course, Invictus intends to develop the Project by attracting a senior farm-in partner and anticipates the JV partners to commit to an exploration well on its lead prospect.
Invictus Energy Limited (ASX:IVZ) has been progressively exploring and appraising the Cabora Bassa Project in Zimbabwe. Invictus shares have been trading on the ASX since 2012. The shares soared up by ~6% to $0.054 on 3 November 2020.
Recently, Invictus released its activities report for the quarter ending September 2020- a period that denoted the achievement of several significant milestones-
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Key Licence Renewals Granted
Exploration Licence Tenure: The tenure of the SG 4571 licence was extended for a further three years. Specifically, the exploration licence for the Second Period runs to August 2023.
Geo Associates (Pvt) Ltd, Invictus’ 80% owned subsidiary and holder of Special Grant 4571, received this significant approval from the Mining Affairs Board. Now, the publication in the Government Gazette will follow.
Invictus plans to undertake a comprehensive work programme in the extended period, including the commitment to drill a minimum of one exploration well.
Zimbabwe Investment Licence Tenure: Invictus also received approval of its application to renew the investment licence from the Zimbabwe Investment and Development Authority for 5 years. The licence provides formal recognition to Invictus as a foreign investor in Zimbabwe, facilitating access to several fiscal benefits and incentives.
Environmental Impact Assessment (EIA) Approval
During the September quarter, the Environmental Management Agency issued EIA Certificate number 8000092361 to Invictus. This gives Geo Associates (Pvt) Ltd the permission to operate in accordance with Part XI of the Environmental Management Act (Chapter 20:27).
Concluding the permitting requirements, The Environmental Management Plan approval enables Invictus to start and undertake activities in the field including seismic acquisition and exploration drilling.
Second Tranche Placement with Mangwana Opportunities Fund Completed
In the September quarter, Invictus completed a further placement (Second Tranche) under the share subscription agreement with Mangwana Opportunities Fund, that was announced in April 2020. The placement raised the equivalent of $222,148.
The agreement makes provision for a further equity investment by Mangwana for the project over the next 12-24 months besides supporting Invictus in accomplishing strategic goals in country.
Besides, cash and cash equivalents at end of September quarter amounted to $1,372,000.
PSA Negotiations Accelerated
Invictus continued its negotiations of Production Sharing Agreements (PSAs) with the Government of Zimbabwe via its parent Ministries and legal representatives. So much so, the drafts have been finalised. They are currently undergoing review by members of an Inter-Ministerial Committee (advised by an Independent Expert).
The process will facilitate the signing of the agreements in the near future and is expected to conclude soon.
Farmout Process Progressing
Invictus’ farmout process of the Project continues. Active discussions with various parties are ongoing.
Progress-wise, the Project has passed technical review/assessment. It is currently undergoing commercial evaluation, above ground due diligence and comprehensive forward program costing (involving drilling cost). In a COVID-19 restrictive work environment, Invictus is working as far as practical with the respective parties, to finalise outstanding requirements.
On a good note, travel restrictions in Zimbabwe have been eased recently. This paves the way for country visits and on the ground due diligence.
Field Operations at Cabora Bassa Project Begin
Subsequent to the end of the September quarter, the Company commenced field operations in the Cabora Bassa Basin in mid-October. This was majorly catalysed by the approval of the Environmental Management Plan, easing COVID-19 restrictions and the conclusion of cultural ceremonies in the Muzarabani as well as Mbire Districts.
As part of the field operations-
- The reconnaissance program and baseline survey comprise traversing of the proposed infill seismic lines for a planned acquisition campaign in the 2021 dry season.
- The program will capture details like topography, access roads, drainage, vegetation cover, soil types, rock exposures, sampling of natural oil and gas seeps, development areas, sites of cultural, religious, historic significance.
- The program has been implemented before the rainy season to map out the routes for the planned seismic acquisition campaign in 2021 and maximise the efficiency of the survey.
Reportedly, the program has progressed exceptionally well to date and is ahead of schedule.