Join our daily newsletter At The Bell to receive exclusive market insights
- Invictus Energy (IVZ) is raising $25 million to fund the drilling of two wells in Zimbabwe’s Cabora Bassa Basin
- The company originally assessed funding options from other parties but ultimately decided to sole-fund the early stages of the drilling program
- Under the placement, Invictus is issuing over 108 million shares to institutional and sophisticated investors at 23 cents
- The first well, Mukuyu-1, is expected to spud early next month, and drilling will take 45 to 60 days to complete before the rig moves to the Baobab-1 well site to test the new Basin Margin play
- IVZ shares are down 16.13 per cent to trade at 26 cents at 1:05 pm AEST
Invictus Energy (IVZ) is raising $25 million through a private placement to fund the drilling of the Mukuyu-1 and Baobab-1 wells in Zimbabwe’s Cabora Bassa Basin.
The placement comes after the company assessed a range of options, including farm-in bids from interested parties, but ultimately decided to sole-fund the initial stages of its drilling program.
Invictus decided to sole-fund the planned works after considering a number of factors but said it remained open to strategic partnering opportunities in the future that could add shareholder value.
Under the placement, Invictus Energy will issue just under 108.7 million shares to institutional and sophisticated investors at 23 cents per share.
The issue price represents a 25.8 per cent discount to the company’s last traded price and a 15.6 per cent discount to its 15-day volume-weighted average price.
Investors will also be entitled to a one-for-one unlisted option for every share issued, and these are exercisable at 40 cents within five years.
Invictus said the placement received strong support, with multiple new and existing institutional investors across North America, the UK, Asia and Australia entering the share register.
“We are moving into a very exciting period for Invictus with the drilling of two high-impact
exploration wells aimed at unlocking the resource potential of the Cabora Bassa Basin,” Managing Director Scott Macmillan said.
Invictus expects the Mukuyu-1 well to spud in early September, and the well will target an estimated 20 trillion cubic feet and 845 million barrels of gas condensate. The drilling across all seven stacked targets is expected to take between 45 and 60 days to complete.
Once drilling has wrapped up at Mukuyu-1, the rig will move to the Baobab-1 well site to test the new Basin Margin play. This play is described as a “shallower and potentially more liquid-prone target” that has similarities to the prolific East Africa Rift “String of Pearls” play.
Invictus expects the drilling of Baobab-1 to take four weeks to complete.
IVZ shares fell 16.13 per cent to trade at 26 cents at 1:05 pm AEST.
