Reconnaissance Energy Africa Ltd (TSX-V:RECO, OTCQX:RECAF) CEO Brian Reinsborough talked with Proactive about the company’s newly announced joint exploration agreement, which adds approximately 5.2 million acres to its asset base in southern Africa.
Proactive: All right, welcome back inside our Proactive newsroom. And joining me now is Brian Reinsborough. He is the CEO of Reconnaissance Energy Africa, or ReconAfrica, as we always call it. Brian, good to see you again. How are you?
Brian Reinsborough: I'm doing great. Thanks for hosting me once again.
Exciting news out from the company late last week. We wanted to get you on and talk a little bit about it. This is an agreement for joint exploration, adding about 5.2 million acres of potential land. So tell me a bit about putting this all together.
Yes, thanks for that question. We've been working on this project for quite some time. Before we drilled our first well in the Damara Fold Belt in Namibia, we wanted to get this acreage locked up — prior to getting our results from the Naingopo Well and before we drill our next prospect.
We feel all the plays that we have in Namibia extend over into Angola. So we want to have that running room. We got another 5 million acres, almost equivalent to what we currently have in Namibia. So we’re doubling our acreage position in a play that we like a lot. As you would have seen from the results of our Naingopo Well a few months ago, we had oil on it. That’s a really good sign that this play is working. And when these fold belts work, they typically have large aerial extents — which is why we want to get this acreage tied up as quickly as possible.
So this agreement — when it's all fully done — you’ll earn about 80% into this particular area, and there's not been much work on this region. Tell me a bit about it.
This area has been relatively unexplored for the last several decades, which is why we find it appealing. We do know there’s a bunch of oil seeps in that region. We’re highly confident that our plays extend into this area. So, we’ll start out doing some regional geology work with the ANPG and local government. We’ll do regional seep work, seep analysis, and that will lead into a more formal program. We’ll probably shoot some seismic and, hopefully, drill a well.
Brian, how important was the work that you've done already to the work that you want to do in this particular area? As far as the company being known — and you being known — was that a big part of this?
Yes, it was. The regional geology that our exploration team did — Chris Sembritzky and his team — was fundamental in understanding the play in this area. Angola is a well-established oil and gas jurisdiction. They’ve produced oil for almost 50 years and are currently producing about one million barrels of oil per day. So, going into that jurisdiction was a good and easy discussion. It helps that they recognize the company and my background. That certainly laid the groundwork to have a really constructive exploration agreement. I should emphasize — it’s very rare in this day and age to get this big of a tract of acreage for such a low cost. We know the geology as good as — if not better than — anybody in this region. So we’re super excited about it.
Okay, let’s just update everyone again. What’s the process here? You talked earlier about doing some on-the-ground work.
Exactly. First thing, we’re going to be drilling a well on the Namibia side — we call this Prospect I — and it's about 47 km away from the Angola border. That will really help de-risk the play going north. On the Angola side, we’re sending a team over there in early May for a first tactical meeting. That will start laying out the program for collecting all the data in the region, doing any on-ground oil seep analysis, and then we’ll start planning a seismic program. These onshore seismic programs typically take about a year in advance to plan appropriately, so we’ll start all those steps in the next couple of weeks. But listen, we think the potential here is immense, and we’re super excited to have this locked up.
Quotes have been lightly edited for clarity and style