Reconnaissance Energy Africa Ltd. (the "Company" or "ReconAfrica" or "Recon") announces that, in connection with its previously announced overnight marketed, listed issuer financing exemption private placement offering of units of the Company (each, a "Unit"), it has increased the size of the offering due to strong investor demand, and has entered into an amended agreement with Research Capital Corporation as the lead underwriter and sole bookrunner, on behalf of a syndicate of underwriters, including Canaccord Genuity Corp. and Haywood Securities Inc. (collectively, the "Underwriters"), pursuant to which the Underwriters have agreed to purchase 33,684,300 Units at a price of C$0.95 per Unit for aggregate gross proceeds of C$32,000,085 (the "Offering").
In connection with the Offering, certain members of management and directors of the Company and other president's list investors will be investing in the Offering.
Each Unit will be comprised of one common share of the Company ("Common Share") and one- half of one Common Share purchase warrant of the Company ("Warrant"). Each Warrant will entitle the holder to purchase one Common Share at an exercise price of C$1.20 at any time up to 36 months from closing of the Offering. In addition, the Company will use commercially reasonable efforts to obtain the necessary approvals to list the Warrants on the TSX Venture Exchange (the "Exchange").
For the purposes of accelerating value capture, ReconAfrica plans to expedite activity across its portfolio, which is supported by the recent success at the Kavango West 1X well and the addition of the Ngulu Block offshore Gabon, which includes the Loba discovery, to the Company's portfolio. This Offering sets out to fund that multi-pronged 2026 capital program. Net proceeds will be used for the following activities:
Conducting an extensive production test and installing production casing at the Kavango West 1X discovery well;
Advancing pre-drill operations to a drill ready status at the Kavango appraisal well;
Re-processing seismic at the Loba discovery and exploration inventory on the Ngulu block in Gabon to advance towards a resource report and drill ready status of an appraisal well; and,
General corporate purposes and working capital.
Corporate Update
Namibia – Kavango West 1X
Production Test – As previously announced, ReconAfrica and its partners decided to proceed directly to production testing and not to perform a drill stem test ("DST") to allow for more controlled testing of isolated intervals of interest. Due to thicker than expected Huttenburg and Elandshoek hydrocarbon bearing sections, a cased hole production test was selected as the most efficient use of capital to test the deliverability of all hydrocarbon bearing intervals. As a result of the extensive section of hydrocarbons, we plan to test up to eight intervals.
Production Casing String – A production casing string will be installed from the surface down to a total depth of 4,260 metres. This will allow for more controlled testing of all hydrocarbon-bearing intervals and for the well to be completed as a potential producing well.
Progress Kavango Discovery Toward Commercialization – In addition, ReconAfrica will be selecting the appraisal well location, advancing permitting and conducting drill-site preparations to a drill-ready status. The appraisal well location will test the pre-drill expected resource estimate of the Kavango structure. Upon successful results of the appraisal well, the Company would be able to issue an updated resource report and book reserves on the field. This appraisal well will be a critical step toward a final investment decision ("FID")/commercialization.
Angola – Memorandum of Understanding Area ('MOU")
As a result of the success at the Kavango West 1X well, the Company plans to accelerate geochemical sampling of surface oil seeps in the MOU area in Angola and commence permitting for a potential 2D seismic program as part of the broader evaluation of the Damara Fold Belt. Crews are expected to be in the field in April 2026 to commence the sampling program.
Gabon – Ngulu Block
In September of 2025 the Company signed a Production Sharing Contract ("PSC") with the Republic of Gabon and its national oil and gas company, Gabon Oil Company ("GOC"), for the Ngulu block located in the shallow waters offshore central Gabon. The Company has been gathering all the available seismic surveys and other technical data that is available on the Ngulu lease and sourcing seismic reprocessing vendors. The Company has received 3D seismic data covering prospective areas of interest and reprocessing efforts are commencing this month. Following the reprocessing and detailed evaluation of the seismic data, the Company plans to obtain a third-party resource report outlining the significant potential of the block and progress the Loba field appraisal well to a drill-ready status. The re-interpreted seismic data, combined with the updated resource report, are critical steps for the selection of an appraisal well location on the Loba discovery.
Additional Details on the Offering
The Company has granted to the Underwriters an option (the "Over-Allotment Option"), exercisable, in whole or in part, in the sole discretion of the Underwriters, to purchase up to an additional number of Units that in aggregate would be equal to 15% of the total number of Units to be issued under the Offering, to cover over-allotments, if any, exercisable at any time up to two (2) business days prior to closing of the Offering.
The closing of the Offering is expected to occur on or about January 19, 2026 (the "Closing"), or such other earlier or later date as the Underwriters may determine. Closing is subject to the Company receiving all necessary regulatory approvals.
The Offering is expected to be completed pursuant to an underwriting agreement to be entered into by the Company and the Underwriters. The Units will be offered for sale pursuant to the listed issuer financing exemption under Part 5A of National Instrument 45-106 – Prospectus Exemptions, as amended by CSA Coordinated Blanket Order 45-935 – Exemptions from Certain Conditions of the Listed Issuer Financing Exemption (collectively, the "Listed Issuer Financing Exemption"), in all provinces of Canada, except Quebec, and other qualifying jurisdictions, including the United States. The Units and the underlying securities offered under the Listed Issuer Financing Exemption will be immediately "free-trading" upon closing of the Offering under applicable Canadian securities laws.
There is an amended and restated offering document (the "Offering Document") related to this Offering that can be accessed under the Company's profile at www.sedarplus.ca and at the Company's website at https://www.reconafrica.com/investors/company-reports-and-filings/. Prospective investors should read this Offering Document before making an investment decision.
The participation of insiders will be considered a related party transaction subject to Multilateral Instrument 61- 101 – Protection of Minority Security Holders in Special Transactions ("MI 61-101"). The Company intends to rely on exemptions from the formal valuation and minority shareholder approval requirements provided under subsections 5.5(a) and 5.7(1)(a) of MI 61-101 on the basis that participation in the Offering by insiders will not exceed 25% of the Company's market capitalization.
As consideration for their services, the Underwriters will receive a cash fee equal to 6% of the gross proceeds of the Offering, including the Over-Allotment Option. In addition, the Company will issue to the Underwriters broker warrants equal to 6% of the aggregate number of Units issued under the Offering, including the Over-Allotment Option. Each broker warrant will entitle the holder to purchase one Common Share at an exercise price of C$0.95 for a period of 36 months from closing of the Offering.