Canadian firm makes a play for larger stake in Namibia’s offshore oil discovery and exploration opportunities

Canadian oil and gas company Africa Oil Corp. has set the wheels in motion to expand its ownership interest in Impact Oil & Gas, an Africa-focused exploration player with hydrocarbon exploration and appraisal assets in the Orange Basin off the coast of Namibia.

Thanks to a call and put option agreement with three shareholders in Impact Oil & Gas to purchase a material 7% interest in the latter, the deal, if exercised, will increase Africa Oil’s Impact shareholding to 39.5%.

The option agreement is set to enable the Canadian firm to acquire an additional 80,160,198 shares in the company at an exercise price of GBP 0.57 per share for up to six months from the signing date of August 27, 2024.

If Africa Oil has not exercised its call option by the end of the fourth month, those selling their shares are said to have the right to put their Impact shares to the Canadian firm at an exercise price of GBP 0.57 until the expiry of the option period.

Should this agreement be exercised, Africa Oil will hold 449,464,396 shares in Impact, representing a 39.5% shareholding position on a fully diluted basis.

Dr Roger Tucker, Africa Oil Chief Executive Officer, commented: “Through our shareholding in Impact we have exposure to an exciting opportunity set in Namibia’s Orange Basin, including the Venus oil discovery, and a highly prospective exploration and appraisal program on Blocks 2913B and 2912.

“This purchase achieves the company’s objective of materially increasing its ownership in Impact, enhancing its rights and influence over a core strategic asset and value driver for Africa Oil.”

The deal to boost its stake in Namibia’s Orange Basin comes after the firm sealed a deal to consolidate its shareholdings in Prime Oil & Gas Coöperatief, an investee company with deepwater assets located offshore Nigeria.

The move followed an agreement that Africa Oil, Eco Atlantic’s Azinam, and Ricocure made to sell some of their participating interests in Block 3B/4B offshore South Africa to TotalEnergies and QatarEnergy.

A couple of weeks ago, Impact inked a deal with Silver Wave Energy to acquire its 10% interest in Area 2, which sits outboard of, and compliments, the firm’s Transkei and Algoa blocks off the east coast of South Africa. Once the sale is done, the company will hold 100% participating interest and operatorship in Area 2.

Located within the emerging South Africa and Namibia (SANAM) super-basin, which stretches from northernmost Namibia to the Durban Basin of eastern South Africa, this asset is believed to share the same prolific petroleum play as is currently being explored in the Orange Basin of Namibia, and further proven by the Brulpadda and Luiperd discoveries in South Africa’s Outeniqua Basin.