Reconnaissance Energy Africa has announced it has entered into a Letter of Intent with its partner, the National Petroleum Company of Namibia (NAMCOR) to acquire half of NAMCOR’s 10% carried participating interest in the approximate 6.3 million acres petroleum exploration licence
(PEL 73) in the Kavango basin, NE Namibia.
Consideration for the 5% carried interest shall comprise
(a) 5,000,000 common shares in the capital of ReconAfrica having an aggregate value of C$31,750,000 (approx US$25M) with a deemed price per ReconAfrica Share of C$6.35, and
(b) US$2,000,000 in cash. The Consideration Shares will be subject to a hold period of four months and one day under Canadian securities laws as well as certain restrictions on resale as agreed to with the Company.
ReconAfrica and NAMCOR shall enter into a mutually acceptable agreement and other related documents containing the terms and conditions of the Transaction, including those that are customary in international oil and gas transactions by February 17, 2022.
Closing of the Transaction is expected to occur on or about March 30, 2022, and is subject to the Company receiving all necessary regulatory approvals, including, but not limited to, the acceptance of the TSX Venture Exchange to the issuance of the Consideration Shares.
Immanuel Mulunga, Managing Director, NAMCOR stated, “We are delighted to enter into this strategic and mutually beneficial transaction with ReconAfrica. The transaction, is not only less onerous but adds significant strength to NAMCOR’s balance sheet, as well as provides NAMCOR with exposure to the entire Kavango sedimentary basin in Namibia and Botswana. We have the utmost confidence in ReconAfrica as the Company has
proven to be a responsible operator in our country with an excellent track record in the performance of its work obligation.”