Harare – Exciting oil sector data was spotlighted this week as an Australian firm exploring in northeastern Zimbabwe said preliminary results indicated the country could have Africa’s largest onshore oil reserves.
Invictus Energy, listed on the Australian Stock Exchange, has been exploring for oil and gas in the Zambezi Basin since 2015.
Its claims sit at the heart of a 2,000-hectare field in Muzarabani District, blocks that were partially explored and then abandoned by Mobil in the early 1990s.
The area is in close proximity to recent major discoveries in neighbouring Mozambique.
In August 2020, Invictus said it was raising US$20 million to sink its first test wells after spending about US$3,5 million on preliminary work.
“(Invictus is) progressing the development of the Cabora Bassa Project in Zimbabwe that encompasses the Muzarabani prospect, a multi-TCF conventional gas-condensate (a multi–trillion cubic feet) target which is potentially the largest, undrilled seismically defined structure onshore Africa,” the firm said in commentary to financial results for the half-year ended December 31, 2020.
“The prospect is defined by a robust dataset acquired by Mobil in the early 1990s that includes seismic, gravity, aeromagnetic and geochemical data. During the reporting period, Geo Associates, the company’s 80 percent owned subsidiary and holder of Special Grant 4571 received notification that its application to extend the tenure of the SG 4571 licence for a further three years was granted by the Mining Affairs Board. The exploration licence for the second period runs to August 2023.
“The company will undertake a comprehensive work programme for the second three-year exploration period including the commitment to drill a minimum of one exploration well. The company received approval of its application to renew the investment licence from the Zimbabwe Investment and Development Authority for a period of five years,” it said.
Such an oil find would not only be good news for Zimbabwe, but a Southern Africa region that has largely relied on importing fossil fuels from far afield at great expense.
However, the operating environment is getting tougher as the industry contends with labour restrictions, disrupted supply chains and the long-term impact on revenues and investment of the collapse in global demand for energy products.
International oil companies that previously regarded the acquisition of new hydrocarbons reserves as a primary indicator of their corporate health are now touting the benefits of prudent investment in their existing oil and gas assets and diversification away from riskier upstream activities.
Further, the growing chaos in Mozambique, where a radical Islamist uprising threatens gas development in the north of that country, has revived the debate about the “resource curse”, and Africa’s internal capacity to develop its resources without foreign interference and destabilisation.