Invictus raises US$32m in capital funding

Invictus-Energy-Managing Director Scott Macmillan

Invictus has revealed it is now completely self-funded after it raised AUD48,7 million (nearly US$32 million) in capital funding in the year ended June, which has gone into ongoing drilling activities in its Cabora Bassa project.

Following years of failing to secure funding to start the Cabora Bassa project in northern Zimbabwe, Invictus has managed to attract investors while also implementing several capital-raising initiatives.

With Europe desperately looking for new gas and oil sources as it will soon stop such purchases from Russia owing to Kremlin’s invasion of Ukraine, Zimbabwe has scaled up its support to Invictus to cash in on increasing demand for the commodity.

Invictus estimates that the country has oil reserves of around 5,5 billion barrels and significant natural gas reserves in the Cabora Bassa project.

“Further bolstering the company’s financial position is the AU$20 million (US$12,95 million, plus an additional AU$25 million, US$16,18 million, subsequent to the decision to solely fund the drilling campaign) raised through private placements to sophisticated and institutional investors, along with a further AUD3,7 million (US$2,39 million) raised through the conversion of options during the financial year,” Invictus said in its 2022 annual report for the year ended June it shared with the firm’s shareholders.

“The capital raises have been supported by a range of existing shareholders and new investors, placing the company in a strong position to self-fund the drilling of the Mukuyu-1 and Baobab-1 wells. A discovery at Mukuyu-1 or Baobab-1, could be transformational for not only Invictus and its shareholders, but Zimbabwe and the wider southern Africa energy market.”

Invictus said it got approval from the Depository Trust Company (DTC) in July to provide real-time electronic clearing and settlement for its ordinary shares traded on the OTCQB through the Depository Trust & Clearing Corporation in the United States.

DTC is an America-based corporation that performs the functions of a central securities depository as part of the US national market system.

“The approval for DTC eligibility simplifies the process of trading for North America-based investors and enhances the liquidity of the company’s shares on the OTCQB by broadening the pool of brokerage firms that will allow their clients to trade the stock,” Invictus added.

The OTCQB (over-the-counter QB), also referred to as a venture market, is a platform for entrepreneurial and developmental stages for US and international companies under the American financial securities firm, OTC Markets.

“To be eligible, companies must be current in their reporting, have a minimum bid price of US$0,01, may not be in bankruptcy and must undergo an annual verification and management certification process,” part of OTC Markets standards read.

“These standards provide a strong baseline of transparency to improve the information and trading experience for investors.”

Seeking such investment opportunities has helped the energy firm to carefully control expenditures and spending by utilising its own team to expedite the completion of high-quality work.

As of June 30, 2022, the carrying value of the capitalised exploration and evaluation properties of the consolidated entity was AUD28 228 960 (US$18,27 million) from a 2021 comparative of AUD8 821 190 (US$5,71 million).

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Recovering these funds is dependent on several factors including the sale of the company’s assets. Other factors include the level of reserves and resources, future technological changes, cost of drilling and production, production rates, future legal changes (including changes to environmental restoration obligations) and changes to commodity prices.

The firm’s capital spending led to it increasing its total assets to AUD43,13 million (US$27,89 million) in the period under review from a 2021 comparative of AUD18,38 million (US$11,89 million).

IEL was in a very liquid form having AUD3,30 (US$2,13) to every dollar of debt, at the end of June.

Challenges facing Invictus include the impact of COVID-19 on supply chains and the Russia/Ukraine war’s effect on global energy prices.

Invictus is positioning itself to be a major gas and energy source in southern Africa.

“We remain ambitious with our plans to expand and build on our achievements to date, drilling two basin opening wells, building a carbon offset business and continuing to evaluate new ventures that fit within our strategy,” it said.


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