The National Petroleum Corporation of Namibia (“NAMCOR”) and Reconnaissance Energy Africa this week announced the execution of a Joint Operating Agreement (“JOA”) to develop the resource potential of the Kavango Sedimentary Basin, Northeast Namibia.

Under the agreement, the two companies will jointly pursue an ongoing petroleum exploration program in the Kavango East and Kavango West regions of Namibia, with ReconAfrica covering the full costs to commerciality. The two companies initially entered into a Petroleum Exploration Agreement with the Government of the Republic of Namibia in 2015, under which they acquired Petroleum Licence No. 73.

The JOA was officially executed on Friday, June 11, 2021, and signed by ReconAfrica CEO Scot Evans and NAMCOR Managing Director Immanuel Mulunga.

"We are delighted to have finalized the negotiations and signature of a Joint Operating Agreement (JOA) with ReconAfrica for Petroleum Exploration License No. 73. This Agreement will govern the relationship between NAMCOR and ReconAfrica; and we will collectively advance the search for oil in the Kavango Sedimentary Basin in accordance with the Laws of Namibia. We understand the hydrocarbon potential of the Kavango Basin; hence collaborating with an international company with both technical and financial capabilities such as ReconAfrica will unlock the discovery of commercially viable hydrocarbon reserves and thereby enhance economic development in the country," said Immanuel Mulunga, Managing Director of NAMCOR.

"We’re pleased to finalize this operating agreement, which solidifies our partnership with NAMCOR. We look forward to working with NAMCOR as we jointly endeavor to unlock the potential of Namibia’s vast national resources, providing jobs, economic growth and long-term responsible resource development - which includes significant contributions to the social and environmental aspirations of the country," said Scot Evans, Chief Executive Officer of ReconAfrica.

To date, ReconAfrica has drilled two test wells in the Namibian petroleum licence area, both of which have revealed evidence of a working conventional petroleum basin. The Company plans to drill an additional two wells in 2021 to determine if the Kavango Sedimentary Basin will yield a commercially viable petroleum reservoir. Under their Petroleum Agreement with the Namibian government, ReconAfrica and NAMCOR would potentially activate a 25-year Production Licence if the exploratory drilling program proves the Kavango Sedimentary Basin is commercially viable.

The joint venture partners foresee continued national economic opportunities, including local job- creation, substantially adding to the more than 200 jobs for Namibians already generated by the current exploration program. In addition to the economic benefits that will flow from the agreement, which also include taxes and potential future royalties, the two companies have committed to the adoption of a stringent Health, Safety and Environment Plan that will guide operations.

During the last year, ReconAfrica has been working closely with all levels of government in Namibia, including Regional and traditional leadership, as it planned and initiated drilling operations in the Kavango East and Kavango West regions. This engagement is a long-term commitment, supported by a growing management and technical team in Namibia that is focused on project management, stakeholder relations, environmental management, and wildlife conservation initiatives.

Already, ReconAfrica has demonstrated its commitment to the people of the Kavango Region, beginning with its support of COVID-19 public-health measures through the donation of health- care packages and hospital equipment and the drilling of four community water wells, followed by a commitment to drill and donate another 16 community wells in the near term.

Kavango Basin

ReconAfrica holds a 90% interest in a petroleum exploration licence in northeast Namibia. The exploration license covers the entire Kavango sedimentary basin an area of approximately 25,341.33 sq km (6.3 million acres), and based on commercial success, it entitles ReconAfrica to obtain a 25 year production licence. The Kavango Basin offers a thick Permian sequence that we believe will supply a huge conventional oil play.

ReconAfrica acquired a high resolution aeromagnetic survey of the licence area and conducted a detailed analysis of the resulting data and other available data, including reprocessing and reinterpretation of all existing geological and geophysical data. The survey and analysis confirm that the Kavango Basin reaches depths of up to 30,000 feet, under optimal conditions to preserve a thick interval of organic rich marine source rocks. The Company’s initial work program is designed to confirm the presence of an active petroleum system in the Kavango Basin.

KeyFacts Energy: NAMCOR Namibia country profile   l   ReconAfrica Namibia country profile