Next Investors logo grey

Invictus confirms oil potential at Cabora Bassa Basin


Published 24-SEP-2018 12:05 P.M.


6 minute read

Hey! Looks like you have stumbled on the section of our website where we have archived articles from our old business model.

In 2019 the original founding team returned to run Next Investors, we changed our business model to only write about stocks we carefully research and are invested in for the long term.

The below articles were written under our previous business model. We have kept these articles online here for your reference.

Our new mission is to build a high performing ASX micro cap investment portfolio and share our research, analysis and investment strategy with our readers.

Click Here to View Latest Articles

This product is classified as ‘very high risk’ in nature due to its location and geopolitical situation of the region. Finfeed advises that extra caution should be taken when deciding whether to engage in this product, however if you are not sure whether it is suitable for you we suggest you seek independent financial advice.

Invictus Energy (ASX:IVZ) announced this morning that its ongoing basin modelling and geochemical studies confirm the oil potential of the Cabora Bassa Basin in Zimbabwe.

Encouragingly, preliminary gravity data reprocessing also confirms the shallow basement trend associated with the massive Mzarabani anticline, and identifies further leads.

Further to that, the hydrocarbon charge across the Cabora Bassa Basin has been generated from multiple fluvial, lacustrine influenced and lacustrine source rock sequences.

IVC managing director, Scott Macmillan, said: “The results of our ongoing technical work are extremely encouraging and is enhancing our understanding of the potential of our acreage in the Cabora Bassa Basin. The basin modelling and source rock characterisation is one of the key pieces of work that significantly de-risks the charge timing and availability to the Mzarabani Prospect and the wider basin as well.

“In addition, new processing techniques applied to the raw datasets that were not available 25 years ago are beginning to show additional structural detail in the basin that was not previously possible, as indicated by the preliminary gravity processing results,” added Macmillan.

“Our technical work is continuing on this exciting project and we look forward to updating the market on our progress in due course as our work program delivers results.”

Note that any decision with regards to adding this stock to your portfolio should be taken with caution and professional financial advice sought.

The Cabora Bassa Project encompasses the Mzarabani Prospect, a TCF+ conventional gas-condensate target — this is the largest, undrilled, seismically defined structure in onshore Africa. The prospect is defined by a robust dataset acquired by Mobil in the early 1990s that includes seismic, gravity, aeromagnetic and geochemical data.

The Basin Model was built to assess the overall basin potential, to provide further data to de-risk specific prospects, and to evaluate the range of parameters that control the magnitude, phase and timing of hydrocarbon generation, expulsion and migration across the Cabora Bassa Basin and SG 4571 acreage.

The model utilises horizons derived from the vectorised paper seismic sections which have been interpreted to produce a series of basin wide depth surfaces that define the potential extent of the source rock in the Karoo Super Group series in the Cabora Bassa Basin.

The Basin Model has allowed IVC to model the petroleum system, and migration of the hydrocarbons over time.

The results of the modelling provide IVC with material to further de-risk the extent of the petroleum system across its SG 4571 acreage.

The conclusions from previous source rock characterisation and basin modelling studies undertaken by Mobil over 25 years ago have been superseded with new geological understanding derived from updated industry classification of source rock types and basin modelling methods.

At that point in time, the deep lacustrine (lake) source rock type present in the Cabora Bassa Basin was not widely regarded as having significant oil-generating potential. However, recent multi-billion barrel oil discoveries in onshore African rift basins such as the Albertine Graben in Uganda and the Lokichar Basin in Kenya are derived from deep lacustrine source rocks contained in these basins.

These significant oil discoveries, which are derived from lacustrine source rocks, have resulted in the reclassification of their potential as rich oil and wet-gas generating source rocks.

IVC is in the process of acquiring additional outcrop source rock samples over the basin wide area to further enhance the geochemical dataset.

The Basin Model also further demonstrates a reduction in the key risk previously identified by Mobil relating to the timing of hydrocarbon charge and trap formation.

Mobil’s previous basin modelling work concluded that the Upper Angwa source rock may have generated and expelled hydrocarbons prior to the formation of the trap (Mzarabani anticline / 4-way dip closure).

The new Basin Model concludes that the source rock within the primary target of the Mzarabani Prospect, the Upper Angwa Alternations Member, is within the oil and wet gas window present day on the flanks of the basin, and has undergone active hydrocarbon generation post trap formation from the source kitchen within the Mzarabani fetch area.

The Basin Model has also implemented updated understanding of the thermal regime and burial depth history, which is a key control of the hydrocarbon phase generation (oil or gas) for this source rock type.

Previous Mobil work assumed the strict and now outdated ‘McKenzie Model’, which results in an overestimation of the regional thermal gradient. This therefore led to higher modelled maturities and the conclusion that the hydrocarbon phase was more likely to be gas than oil.

However, the current Basin Model demonstrates that the Mzarabani Prospect may lie within both the light oil generation window (at the crest of the structure) and the wet-gas generation window (on the flanks of the structure) due to size of the structure and significant vertical relief.

The Basin Model has assumed two separate end member cases due to the lack of well calibration within the Cabora Bassa Basin. The first conservative case assumes a widespread but poor quality source rock distribution with little to no liquids potential, as per Mobil’s previous interpretation.

The second updated case assumes a widespread fluvial to lacustrine source rock with liquids generation potential, as per the updated understanding of the Cabora Bassa Basin from ongoing technical work.

While the new Basin Model is far more sophisticated than anything created previously for the Cabora Bassa Basin and the SG 4571 licence area, IVC has cautioned that modelling is reliant on a series of assumptions — notwithstanding its internal estimates for the exploration potential of the Cabora Bassa Project, there is no well calibration within the basin and it is guided by outcrop samples of source rock which may vary in lateral extent and thickness within the basin subsurface.

The preliminary gravity data reprocessing has revealed that subtle northwest-southeasterly features enhanced within the southwest of SG 4571 that are obscured by larger features such as the Mzarabani structure are present. These features were unable to be mapped previously due to the seismic line spacing. However, the new reprocessed gravity data along with the aeromagnetic data will assist in the seismic data interpretation in between the 2D seismic lines and are expected to potentially delineate further leads within the basin.

The Basin Model will also be updated once the final 2D seismic dataset has been reprocessed and reinterpreted, which is expected towards the end of the fourth quarter.

General Information Only

S3 Consortium Pty Ltd (S3, ‘we’, ‘us’, ‘our’) (CAR No. 433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information and is for informational purposes only. Any advice is general advice only. Any advice contained in this article does not constitute personal advice and S3 has not taken into consideration your personal objectives, financial situation or needs. Please seek your own independent professional advice before making any financial investment decision. Those persons acting upon information contained in this article do so entirely at their own risk.

Conflicts of Interest Notice

S3 and its associated entities may hold investments in companies featured in its articles, including through being paid in the securities of the companies we provide commentary on. We disclose the securities held in relation to a particular company that we provide commentary on. Refer to our Disclosure Policy for information on our self-imposed trading blackouts, hold conditions and de-risking (sell conditions) which seek to mitigate against any potential conflicts of interest.

Publication Notice and Disclaimer

The information contained in this article is current as at the publication date. At the time of publishing, the information contained in this article is based on sources which are available in the public domain that we consider to be reliable, and our own analysis of those sources. The views of the author may not reflect the views of the AFSL holder. Any decision by you to purchase securities in the companies featured in this article should be done so after you have sought your own independent professional advice regarding this information and made your own inquiries as to the validity of any information in this article.

Any forward-looking statements contained in this article are not guarantees or predictions of future performance, and involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, and which may cause actual results or performance of companies featured to differ materially from those expressed in the statements contained in this article. S3 cannot and does not give any assurance that the results or performance expressed or implied by any forward-looking statements contained in this article will actually occur and readers are cautioned not to put undue reliance on forward-looking statements.

This article may include references to our past investing performance. Past performance is not a reliable indicator of our future investing performance.