Reconnaissance Energy Africa (ReconAfrica) has finalised the sale of a 20% working interest in Petroleum Exploration Licence 73 (PEL 73) in Namibia to BW Energy.
The deal closed following regulatory approvals from the Namibian Ministry of Mines and Energy (MME) and Namcor Exploration and Production (NAMCOR).
The transaction, signed in July 2024, restructures the ownership of the onshore Namibian licence, with ReconAfrica retaining a 70% operating interest, BW Energy holding 20%, and NAMCOR maintaining its 10% stake.
BW Energy CEO Carl Arnet said: “The transaction will enable BW Energy to expand its footprint in a strategically important energy region and further our position as a leader in Namibia’s journey towards energy independence. The data and insights gained through ReconAfrica’s exploration campaign will further our understanding of the geology and petroleum system in Namibia.”
The deal includes a total potential consideration of $141m, structured across multiple payments.
BW Energy has made an initial equity investment of $16m in ReconAfrica. Additionally, the company will provide $45m in carry payments to ReconAfrica, contingent on the onshore Namibian project reaching a final investment decision (FID).
These carry payments will be disbursed in two instalments, one at FID and the second a year after production begins.
Further contingent payments of up to $80m are tied to production milestones.
BW Energy will make three separate payments of $25m when specific free cash flow targets are met. An additional $5m payment is scheduled 60 days after the start of commercial production.
ReconAfrica, a Canadian upstream oil and gas company, focuses on exploration in the Damara Fold Belt and Kavango Rift Basin, an area spanning approximately eight million contiguous acres across northeastern Namibia and northwestern Botswana.
The company has continued its operational activities in PEL 73, announcing in November 2024 that it had completed drilling operations on the Naingopo exploration well. The well reached a total depth of 4,184m and is targeting an estimated 181 million barrels of unrisked and 15 million barrels of risked prospective light-to-medium oil resources.
ReconAfrica president and CEO Brian Reinsborough said: “The results of the Naingopo exploration well will be released shortly following third party analysis of our extensive evaluation programme, which was undertaken after the completion of drilling operations on the well.
“Results have been delayed due to transportation of side wall cores and fluid samples over the holiday period. All samples have now arrived with our third parties and are being analysed.”
