Reconnaissance Energy Africa, a Canadian oil and gas company, announced on Thursday its decision to sell its operations in Mexico to privately owned Chame Energy for $7.5 million. This strategic move will allow the company to double down on its operations in western Africa.
Under a definitive agreement, Reconnaissance Energy Africa will sell its subsidiary Renaissance Oil, which currently holds all of its assets in Mexico. The transaction not only provides the company with access to working capital but also enables it to exit Mexico and eliminate the legacy liabilities from its balance sheet, which amount to over $100 million.
Chief Executive Brian Reinsborough expressed his optimism about the deal’s impact on the company’s overall strategy. Reinsborough stated, “This transaction streamlines our portfolio and enables the company to focus its resources on progressing our joint venture partnership efforts and preparing to execute our multi-well, high-impact exploration program in Namibia, which is set to begin in the first quarter of 2024.”
Reconnaissance Energy Africa primarily operates in Namibia and Botswana. Its increased focus on western Africa reflects the company’s commitment to advancing its joint venture partnerships and pursuing its ambitious exploration program. With this strategic shift, Reconnaissance Energy Africa aims to position itself for long-term growth and success in the region.