Interpose shares have doubled after it bought a big gas project in Zimbabwe
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Gas minnow Interpose has its hands on a new project in Zimbabwe and investors are excited.
The shares pushed to a new 52-week high on Wednesday — hitting 5.7c, a gain of 97 per cent on the previous day.
The stock closed at 4.9c.
Interpose (ASX:IHS) told investors it was acquiring an 80 per cent stake in “potentially the largest, seismically defined, undrilled hydrocarbon structure onshore Africa”.
Interpose has struck a deal to acquire Invictus Energy Resources, which owns the stake in the permit that covers 250,000 acres in the Cabora Bassa Basin.
As part of the proposed transaction, Interpose will appoint experienced oil and gas executive, Scott Macmillan, as its managing director.
A Zimbabwean national, Mr Macmillan was previously the business advisor in the Global New Ventures group for Woodside Petroleum, which focused on Africa exploration and the senior reservoir engineer for AWE Ltd – responsible for the Waitsia Gas Field development in Western Australia.
Major American oil company Mobil spent $US30 million ($38.6 million) on exploring the area in the early 1990s but gave up the acreage when their studies revealed that the basin had higher potential for gas than oil.
At that time there was a lack of a structured market for gas in the region, according to Interpose.
“I found this project nearly a decade ago and was immediately attracted to its technical merits, given the considerable dataset that Mobil acquired and the fact that they had already identified a substantial conventional gas-condensate prospect in the basin,” Mr Macmillan said.
“The timing of the award of the permit and change of political regime in Zimbabwe that occurred last year has coincided with improving conditions in the oil and gas industry, and exploration is now firmly back on the agenda as companies look for new growth opportunities.”
Interpose was forced to look for new projects after the unsuccessful drilling of a second well at the Gallatin project in the East Texas Basin.
Before today, Interpose shares had not traded above 3.5c for a year.
The company brought in Ashanti Capital as its corporate advisor to help it find new projects and raise cash.
It has now raised $4.5 million via a placement of shares at 3c each.
The company plans to use the cash to fund exploration at the Cabora Bassa project, conduct an environmental assessment study and commission a third party independent resource certification.
All up, the acquisition and capital raising cost Interpose $1 million.