eBusiness Weekly
Oliver Kazunga
AUSTRALIA Stock Exchange (ASX)-listed miner, Invictus Energy, has signed a Memorandum of Understanding with Zimbabwe’s leading fertiliser producing firm, Sable Chemicals, towards securing natural gas from Muzarabani.
Following results of independent estimates showing improved potential for oil and gas discovery in Zimbabwe at its Muzarabani prospective area, Invictus Energy plans to tap into the natural gas resource.
Early this month, Invictus announced that its latest findings showed improved potential for oil and gas, strongly supporting the possible existence of 1,3 billion barrels of oil equivalent (BOE) or alternatively an estimated resource of 206 billion litres of oil in the Cahora Bassa Basin in Muzarabani. A single oil barrel is equivalent to about 159 litres.
In its quarterly update for the period ending June 30, 2019, Invictus Energy said: “During the quarter the company entered into a non-binding Memorandum of Understanding with Sable Chemical Industries Limited to progress gas supply from the Cabora Bassa Project subject to a commercial gas discovery being made from SG 4571.”
It noted that Sable Chemicals was the sole manufacturer of agriculture grade ammonium nitrate fertiliser in Zimbabwe and a potentially large gas consumer.
“Under the MoU, Invictus and Sable have agreed to jointly work together and co-operate with regards to investigating the economic and commercial viability of supplying natural gas from the Cabora Bassa Project to the Sable fertiliser plant located in Kwekwe, Zimbabwe,” said Invictus.
Invictus Energy managing director, Scott Macmillan, was quoted commenting that the signing of the MoU with Sable marks a significant milestone in commercial negotiations with regards to progress in the Cabora Bassa Project.
“Sable is the sole producer of nitrogenous fertiliser in Zimbabwe and a well-recognised brand in the country. We are proud to work with them to fulfil their ambition of becoming the preferred manufacturer and supplier of fertilisers and other chemical products in Africa,” he said.
Macmillan said potential gas supply of up to 70 million cubic feet per day for 20 years was a substantial volume, which will help underpin the development of any commercial gas discovery.
“This MoU demonstrates the huge local gas demand in an energy starved market in Zimbabwe and we expect to enter into additional gas supply MOUs in the future,” he said.
Sable Chemicals was established in 1969 and presently operates a fertiliser manufacturing plant, which produces ammonium nitrate fertilisers from ammonia gas feedstock imported from South Africa. Sable Chemicals chief executive officer, Bothwell Nyajeka, was also quoted as having expressed pleasure in signing the MoU with Invictus.
“Sable Chemicals currently has a capacity to produce 240 000 tonnes of ammonium nitrate per year and has historically played an important anchoring role in the agricultural sector of Zimbabwe, thus, ensuring that well
priced fertilisers with formulations that are optimised to suit local conditions are made available to farmers in a timeous manner each year,” he said.
“The potential future supply of gas by Invictus is also critical for Sable’s medium-term expansion programme aimed at increasing production to 600 000 tonnes of nitrogenous fertilisers.”
In the quarterly update for the period under review, Invictus said it received the final reprocessed seismic data from its contractors, which produced a significant improvement in the quality of the seismic data and subsurface imaging.
“The better imaging over the giant Muzarabani structure enabled the identification and quantification of additional horizons above and below the primary target. The reprocessed seismic also enabled the identification of the new Msasa Prospect and an additional lead ‘Post-Dande’, which is currently being matured,” it said.
