Sydney-listed Invictus Energy has signed a petroleum exploration development and production agreement with Zimbabwe for the Cabora Bassa gas project, it said on March 29.
The agreement was signed by Invictus’ 80% subsidiary, Geo Associates, and the government on March 26. It provides the company the right to enter into a 25-year production licence following the exploration periods. Invictus said it is currently in the second exploration period.
The agreement also provides for special economic zone status for the Cabora Bassa project which, the company said, will facilitate a host of fiscal and non-fiscal incentives over the life of the project including legal and fiscal stability, offshore banking, zero capital gains tax, tax holiday periods and 15% corporate rate thereafter.
The Cabora Bassa project comprises the Mzarabani and Msasa gas and condensate prospects, which Invictus describes as “world-class multi-trillion ft3” plays. The project received environmental approval from Zimbabwean authorities in August last year.
“This is a significant milestone for the project which provides the security of tenure and the confidence for the significant future investment ahead,” Invictus Energy managing director Scott Macmillan said.
Zimbabwean president Emmerson Dambudzo Mnangagwa, who was also present at the signing ceremony, said that the agreement “represents major strides in our efforts to tap into our oil and gas deposits, which is a new territory in the country’s mining sector”.
Invictus raised A$8mn (US$6mn) via a share placement last week to fund the seismic acquisition campaign in Zimbabwe.