Reconnaissance Energy Africa Ltd. (“ReconAfrica”) has received and reviewed a report issued yesterday by Viceroy Research, a stock-market short-seller, about the Company’s exploratory drilling program in Namibia.
The report, like previous misinformation campaigns launched by Viceroy, contains many intentionally false allegations and displays an unfortunate lack of knowledge and understanding of geology and oil-and-gas exploration. It also unfairly defames government and company officials.
To correct the misinformation disseminated today by the short-seller, ReconAfrica can summarize and reaffirm the intention and recent results of the exploratory drilling program it began in Namibia, as follows:
• ReconAfrica, in collaboration with the Government of the Republic of Namibia, set out this year with a stratigraphic drilling program to prove there is an active conventional petroleum system in the Kavango Sedimentary Basin. The released data and analysis from the first well confirm this. In conventional oil and gas systems, petroleum migrates along faults, fractures, or porous rock from a source to a reservoir. We are confident that this data confirms we have a conventional petroleum system. No fracing is planned or permitted by the Government of Namibia.
• Based on the promising results of the first two stratigraphic test wells, ReconAfrica has initiated a government-approved, low-impact, 2D seismic program (Seismic Fact Sheet) designed to delineate potential hydrocarbon-bearing reservoirs to aid in the assessment of establishing commerciality in the Kavango Sedimentary Basin.
• As it has stated in the past, ReconAfrica has selected and employed two reputable industry service providers to acquire and analyze its well data. The short-seller report is factually incorrect about our service providers and obviously did not conduct any research to support its false allegations.
ReconAfrica is committed to working in close collaboration with the government of Namibia to fully explore and understand the potential of the Kavango Sedimentary Basin and explore for commercial petroleum reservoirs. It also communicates frequently with regulators, investors and credible research organizations to share its findings and ensure full transparency throughout this exploratory phase.
