ReconAfrica has increased a financing package for further testing of its Kavango West 1X discovery in Namibia from C$15 million to C$19 million, just a day after announcing the original capital raise.
The Canadian oil and gas explorer said underwriters have agreed to purchase 26.028 million units at C$0.73 each, raising gross proceeds of C$19.000 million under the enlarged bought-deal offering.
The increase adds about C$4 million to the C$15 million financing announced on 1 September as ReconAfrica prepares for an open-hole horizontal sidetrack and production-testing programme at Kavango West 1X.
Research Capital Corporation is acting as sole bookrunner and lead underwriter for a syndicate that also includes Canaccord Genuity Corp. and ATB Cormark Capital Markets.
Each unit comprises one ReconAfrica common share and half of one share purchase warrant. A whole warrant will allow its holder to acquire another share at C$0.93 for up to 36 months after the financing closes.
The underwriters have also been granted an over-allotment option that could increase the offering by up to another 15%.
ReconAfrica said the net proceeds will principally support the planned horizontal sidetrack and production testing targeting the primary reservoir in the Huttenberg formation and potentially the secondary reservoir in the Elandshoek formation.
Some of the proceeds will also be available for general corporate purposes and working capital.
The financing follows ReconAfrica’s August report that hydrocarbons flowed to the surface during preliminary testing at Kavango West 1X.
The company said natural gas and potential liquids flowed to the surface from two separate zones, including the upper Huttenberg formation. At the same time, hydrocarbons had also previously flowed from the upper Elandshoek.
Those results prompted ReconAfrica to move toward horizontal testing, which is expected to provide more information on the reservoir’s ability to sustain commercial production rates.
The next programme therefore carries greater significance than simply establishing whether hydrocarbons are present at Kavango West.
ReconAfrica now has to establish how the reservoir performs over a substantially longer interval through a horizontal section and whether flow rates and reservoir characteristics are sufficient to support further appraisal and eventual development.
ReconAfrica is undertaking the Kavango West 1X programme with its partners, BW Energy, which holds a 20% working interest, and Namibia’s national oil company NAMCOR, which holds a 10% carried working interest.
The enlarged financing also increases the amount of equity ReconAfrica will issue to fund the next stage.
At the base offering level, 26.028 million new common shares will be issued, alongside warrants that could result in additional shares being issued if exercised.
The C$19 million transaction remains subject to regulatory approvals, including acceptance by the TSX Venture Exchange, and is expected to close on or around 10 September 2026.
The rapid increase from C$15 million to C$19 million comes as ReconAfrica shifts its focus from the initial discovery and vertical-well testing to determining whether Kavango West can support a commercially viable development.
The horizontal sidetrack and production test will now be one of the key technical tests of that ambition.
