Zimbabwe is aiming to finalise the long-awaited Petroleum Production Sharing Agreement (PPSA) with Australian oil and gas explorer Invictus Energy by the end of 2026, according to Pfungwa Kunaka, the Permanent Secretary in the Ministry of Mines and Mining Development.
By Rudairo Maparanga
Speaking at a high-level workshop on energy minerals hosted by ActionAid Zimbabwe, Kunaka acknowledged that the agreement—a critical legal and fiscal framework governing how future oil and gas revenues will be shared between the government and Invictus—has been in negotiation for an extended period due to its complexity and significant international interest in its provisions.
“It has taken time because it is a legal document. There is very much international interest in what it contains,” Kunaka said. “We forecast by the end of 2026, we will have completed the PPSA.”
The timeline extension reflects the intricate nature of crafting a framework that must satisfy both domestic development objectives and the expectations of global investors.
“The investor wants it to be structured in a way that attracts investment,” he added, underscoring the PPSA’s role as the essential precondition for Invictus to secure the substantial financing required to move from exploration to commercial production at its Cabora Bassa Project in Muzarabani District.
What is a PPSA and Why Does It Matter?
A Petroleum Production Sharing Agreement is a legally binding contract between a government and an oil and gas company that outlines the terms under which the company can explore for and produce hydrocarbons. Unlike a simple tax-and-royalty system, a PPSA typically allows the government to receive a share of the actual oil and gas produced, rather than just taxes on profits.
For Zimbabwe, this structure serves multiple strategic purposes. It demonstrates responsibility by both the mining company and the government in managing national resources. It provides investment incentives by creating a transparent, predictable framework that international investors require before committing capital. Crucially, it ensures national benefits flow directly to Zimbabwe once commercial extraction begins.
The PPSA negotiations between Invictus Energy and the Zimbabwean government have been years in the making. The agreement is essential for Invictus to advance its Cabora Bassa Project, which has already recorded significant exploration success, including discoveries at the Mukuyu gas field.
In March 2025, the government and Invictus reached a landmark decision to consolidate two separate agreements—the Petroleum Production Sharing Agreement and the Petroleum Exploration Development and Production Agreement (PEDPA)—into a single, unified legal framework. This consolidation was designed to streamline approval processes, reduce bureaucratic duplication, and provide long-term regulatory clarity.
Scott Macmillan, Invictus Energy’s Managing Director, explained at the time that the unified agreement would provide “a clearer path forward and reflect the shared commitment to enabling a successful development.”
By late 2025, Invictus announced that the PPSA process had been finalised, with formal execution originally expected in January 2026. However, that timeline has since shifted.
Progress on the PPSA has continued despite a significant setback for the company. In late 2025, its proposed strategic partnership with Qatari investment group Al Mansour Holdings collapsed. The failed deal, which would have injected up to US$500 million into Invictus and potentially handed the Qatari firm and other investors a 50% stake, wiped approximately US$89.81 million off the company’s market value.
Earlier, in August 2025, Al Mansour Holdings had acquired a 19.9% stake in Invictus and pledged up to US$500 million in conditional funding—a deal that had sent Invictus shares surging and more than doubled the company’s market value. The collapse of that partnership added further complexity to the negotiations.
Kunaka’s confirmation that the PPSA is now expected by the end of 2026 represents a significant extension from earlier forecasts. In February 2026, multiple media reports indicated that execution was expected by the end of the first quarter of 2026. The African Energy Chamber reported in December 2025 that formal execution was anticipated in January 2026 following the successful completion of the PPSA process.
The extended timeline reflects the detailed work required to finalise a document that will govern one of Zimbabwe’s most significant energy projects for decades to come. Independent estimates suggest the Mukuyu gas field alone could hold up to 20 trillion cubic feet of gas and 845 million barrels of conventional gas condensate, placing it among the most significant sub-Saharan African discoveries in recent years. In addition, the basin hosts light oil and commercially attractive helium concentrations, further enhancing its strategic value.
What the PPSA Contains
While the final terms remain confidential until execution, Invictus has previously disclosed key elements of the draft agreement. According to Macmillan, the PPSA includes a product and profit petroleum split between Zimbabwe and the company that aligns with regional standards, ensuring Zimbabwe receives a fair share of its resources.
The agreement also provides fiscal and non-fiscal incentives essential for importing specialised equipment, services, and personnel required for drilling and development activities. It establishes an internationally competitive legal and commercial structure designed to attract foreign direct investment.
Some reports indicate that the government’s share could be as high as 40% of production, with the Mutapa Investment Fund—holding a 10% partnership in the project—managing the state’s interest.
The Cabora Bassa Project has already been granted National Project Status by the Zimbabwean government, a designation that provides fiscal incentives, duty exemptions on imported equipment, priority access to infrastructure, and expedited permitting. This status recognises the project’s potential to deliver national economic impact, employment creation, and energy security.
Once the PPSA is finalised, it is expected to unlock the next phase of work, including appraisal activities at the Mukuyu Gas Field and the drilling of the Musuma-1 exploration well, targeted for the first half of 2026.
“Musuma-1 is the first high-impact exploration well to be drilled outside the Mukuyu gas-condensate discovery area,” Invictus has stated. Success at Musuma-1 could unlock a substantial new resource base in addition to the proven Mukuyu Gas Field.
Early gas monetisation plans are already being considered, including a proposed gas-to-power project for the Eureka Gold Mine, illustrating how Cabora Bassa gas could be leveraged to deliver immediate domestic benefits once production begins.
Kunaka confirmed that the focus across key government institutions—including the Mutapa Investment Fund, the Ministry of Mines, and the Ministry of Finance—is to conclude the PPSA. This coordinated approach reflects the strategic importance of the agreement for Zimbabwe’s energy future and its ambitions to attract large-scale foreign investment into the sector.
With Invictus having already invested approximately US$90 million in exploration activities in Zimbabwe, the finalisation of the PPSA represents the last major piece of the regulatory puzzle required to transition the Cabora Bassa Project from exploration to commercial development.
The African Energy Chamber has welcomed the progress, describing the completion of the PPSA process as a “landmark moment for Zimbabwe and for African energy more broadly.”
“It shows that when governments put in place clear policy, transparent regulation, and competitive fiscal terms, Africa can unlock its resources and attract investment at scale,” the Chamber stated.
For Zimbabwe, the coming months will test whether the extended timeline can finally deliver the certainty investors require. For Invictus, the PPSA remains the key that unlocks the next chapter of the Cabora Bassa story. And for the nation, the promise of energy security, foreign investment, and a share of substantial resource wealth hangs in the balance.
