07:01:18 EST Mon 06 Dec 2021
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Reconnaissance Energy Africa Ltd
Symbol RECO
Shares Issued 156,808,071
Close 2021-05-21 C$ 8.41
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Reconnaissance displeased with Nat. Geo. "hit piece"

2021-05-25 00:37 ET - News Release

Mr. Scot Evans reports


Reconnaissance Energy Africa Ltd. has provided a factual response to National Geographic's false and defamatory article of May 21, 2021, written by environmental activists.

Reconnaissance's vital operations in Namibia

The company is proud that the Namibian government has selected Reconnaissance as one of over 30 national and international energy companies it trusts to explore the country's natural resource potential in sustainable ways.

In seeking the best path forward to address the country's energy deficit, the government of Namibia is wisely considering many solutions, including oil and gas exploration, geothermal, and biomass assessments, as well as examining wind and solar power alternatives.

While it appreciates there may be concerns about the impact of the Reconnaissance project in Namibia, it would like to point to some important facts that should be considered when assessing the project:

  • Reconnaissance adheres fully to the legal obligations within all territories in which it operates. Allegations have been made in the media suggesting that this is not the case. These are categorically untrue.
  • Canadian practices and technologies, especially as they pertain to resource exploration and development and ESG (environmental, social and corporate governance) practices, are widely regarded as among the best in the world for environmental protection and safety, and the company is bringing those innovations to every aspect of its project.
  • Reconnaissance's work in Namibia is guided by -- and under the constant review and approval of -- representatives of a wide range of government ministries and regulatory agencies, including: the Ministry of Mines and Energy (MME), the Ministry of Agriculture, Water and Land Reform (MAWLR), the Ministry of Environment, Forestry and Tourism (MEFT), the Ministry of Home Affairs, Immigration, Safety and Security, and others.

National Geographic's false allegations

The National Geographic article, published on May 21, 2021, describes a complaint to the Securities and Exchange Commission purported to have been filed on May 5, 2021. Reconnaissance has no knowledge of such a complaint, and a request made to National Geographic for a copy was met with no response.

First, it is important to know that anyone can file a complaint with the SEC. There are no standards or requirements for accuracy or truth for these filings, and they should be understood as such -- unproven allegations.

The following points are in direct response to allegations raised within the National Geographic article:

  • Reconnaissance undertook every aspect of its financings transparently and legally in compliance with applicable securities laws.
  • All sales and purchases of shares by officers and directors of Reconnaissance are publicly disclosed, and are in full compliance with filing and disclosure policies of the securities regulators. Directors and officers of Reconnaissance are net purchasers of over 244,000 common shares and 1.37 million common shares in the past month and year, respectively. Directors and officers are also purchasers in the most recently announced financing.
  • On April 15, 2021, Reconnaissance announced that geological analysis and extraction of oil from well 6-2 samples with subsequent fingerprinting for key characteristics of the liquids provide clear evidence of an active conventional petroleum system with multiple source rock and reservoir intervals in this area of the Kavango basin. This fact has been verified by internationally recognized and independent third parties recognized as leaders in this area. Reconnaissance continues its planned seismic and multiwell drilling programs to confirm commercial quantities of oil and gas, as disclosed in the press release.
  • Reconnaissance's licence is for conventional early-stage exploration within the Kavango basin. As previously noted, no licence to carry out fracking activity exists, nor has been applied for.
  • Current operations are more than 50 kilometres south of the Okavango River and 260 kilometres west of the Okavango Delta.
  • Craig Steinke, the founder of Reconnaissance (Namibia), has been personally and unjustifiably attacked within the National Geographic article. The transaction between Renaissance Oil and Reconnaissance Energy involving the Botswana licence was accepted by the TSX Venture Exchange and supported by an independently prepared evidence of value.

National Geographic enables short sellers

It is a sad indictment of today's American media that a storied publication like National Geographic and a legendary entertainment company like Disney (NYSE:DIS, which owns a 73-per-cent stake in National Geographic Partners) would facilitate activist short sellers attempting to attack Reconnaissance's stock price. Rather than reporting on the true facts about the important work Reconnaissance is performing for the people of Namibia, National Geographic rushed to print a false and defamatory article, purposefully avoiding the detailed information Reconnaissance was willing and preparing to provide, and deliberately concealed its involvement with an anonymous source that reportedly filed an SEC complaint -- characterizing this source as a whistleblower. This all occurred immediately after filed short positions in Reconnaissance's stock increased significantly, more than tripling in volume. National Geographic has enabled these short sellers to potentially line their pockets at the expense of the Namibian people and investors.

The company notes that the Ontario Securities Commission (OSC) and the Investment Industry Regulatory Organization of Canada (IIROC) have recently expressed their growing concern with abusive short selling and a renewed interest in curtailing this kind of destructive behaviour. It hopes they (and their counterparts in the United States) take notice. These predatory tactics through short and distort schemes and so-called hit pieces, enabling short sellers to profit without justification or consequence, are highly destructive to shareholder value and are unbecoming to the credentials of regulated capital markets.

Helping build Namibia's future

The company sincerely believes that Namibia's natural resource industry can be developed in an environmentally and socially responsible manner that is accountable and supports the development and delivery of much needed economic and social benefits, as well as financing investments in local wildlife and ecological conservation.

Ultimately, the Namibian people, through their traditional authorities, elected governments and regulatory agencies, will determine how the country will manage its natural resources.

The company is following all of the terms required under the Namibian government's environmental clearance certificate, which itself complies fully with the provisions of the Environmental Management Act (EMA), Act No. 7 of 2007. It is also Reconnaissance's practice to complete additional environmental and social monitoring and analyses of each site and extended surrounding areas.

The company encourages you to learn more about the best practices Reconnaissance is employing in Namibia by visiting relevant fact sheets found at its website.

Reconnaissance is a Canadian oil and gas company engaged in the opening of the newly discovered deep Kavango sedimentary basin, in the Kalahari Desert of northeastern Namibia and northwestern Botswana, where the company holds petroleum licences comprising approximately 8.5 million contiguous acres. In all aspects of its operations, Reconnaissance is committed to minimal disturbances in line with international best standards, and will implement environmental and social best practices in all of its project areas.

We seek Safe Harbor.

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