IVZ Lab Results from Mukuyu Discovery

Our energy Investment Invictus Energy (ASX: IVZ) just put out more lab results from its Mukuyu discovery.

Late last year IVZ drilled the Mukuyu-2 & Mukuyu-2 sidetrack wells at its oil & gas project in Zimbabwe.

After the sidetrack well in December, IVZ declared discoveries across two different reservoirs (Upper and Lower Angwa).

Today IVZ put out an update on the lab results for the samples taken during last years drill program.

Here are our key takeaways from todays announcement:

1. High quality natural gas confirmed

IVZ’s results so far are showing high quality natural gas with low impurities.

Low impurities are important because it generally means when the time comes to produce the processing inputs are lower before the gas is ready to sell.

IVZ has in the past mentioned it is looking to go down a “low-cost early monetisation development” so this the type of gas IVZ has on its hands is really important.

2. Oil potential from shallower sections of the discovery

So far IVZ has proven a gas-condensate discovery in two formations - the “Upper and Lower Angwa”.

In today’s announcement IVZ also touched on the potential for light oil’s in the shallower sections of its well in the “Upper Angwa” and potentially the “Dande formation”.

Why the light oil potential at shallow depths is interesting to us:

Primarily because IVZ still has a portfolio of leads all along its basin margin that have never been drilled.

IVZ has a prospective resource across those targets of ~1.2 billion barrels of oil equivalent.

As the basin moves closer to the margin, the depth becomes shallower - the deeper sections are where IVZ made its Mukuyu discovery.

So the key takeaway for us is that there is still the upside from any discoveries IVZ could make at one of its many basin margin targets.

The best way to understand how a basin gets shallower toward the basin margin is the image below:

What’s next?

Forward work program for 2024 🔄

The IVZ team is analysing the data from Mukuyu-2 and we are hoping to see a work plan for 2024 with timelines announced soon.

More sampling results 🔄

We expect to see more news similar to yesterday's announcement given IVZ is still analysing samples taken from the Mukuyu discovery.

Resource update 🔄

We expect to see IVZ convert its prospective resource into a contingent resource/reserve.

Usually after a company makes a discovery it is able to take a resource out of the prospective classification and into higher confidence levels.

Flow testing 🔲

IVZ is planning a flow test for next year which will support whether this discovery can be developed in the future.

Interest from majors 🔲

Now that IVZ has declared a discovery, we expect some major oil & gas companies to start to take notice.

IVZ made mention of corporate interest in its December quarterly report where it noted “significant inbound interest for partnering”.