Kinetiko Energy Ltd

Subsidiary Afro Energy signs a co-operation agreement with Mulilo over wind farm overlap on 18.54 km2 (about 1.1%) of ER270. It receives A$1.26m, 20% on signing and the rest at the wind project's financial close (targeted by 31 Dec 2026), plus a right of first refusal on gas supply.

material agreement

Firm commitments for an A$5.4m placement of about 180m shares at 3c, a 14% discount to last trade, well below November's 6.5c. Talent 10, linked to director Mgojo, takes A$3m (100m shares), subject to shareholder approval. Funds go to Phase 1 CNG, exploration drilling, permitting and a new CEO.

capital raising announcement

Kinetiko adopts its Field Development Plan for Phase 1 of the Brakfontein cluster, the basis for the Rolling Cluster strategy announced in April. It now begins applications for a Bulk Sampling Permit and a Production Right over ER271, and says the plan helps access to partner funding and project debt.

other

Kinetiko announces a Rolling Cluster Development Strategy, starting with a compressed natural gas (CNG) cluster at Brakfontein using existing wells, then scaling to full-field LNG. First gas revenue is targeted for Q2/Q3 2027. The 6.0 Tcf 2C resource is unchanged; a field development plan is still being finalised.

other

Firm commitments for a A$3.15m placement of 48.5m shares at 6.5c, a 9.7% discount to last trade, cornerstoned by Talent 10 (linked to new director Mgojo). Up to A$1m from director-related parties needs approval at the 28 November AGM. Funds go mainly to Phase 1a drilling.

capital raising announcement

Extended testing: PT10 shows no discernible decline after 40 days (average 91 Mscfd, 3,522 Mscf); PT06 started declining but plateaued after 27 days (average 164 Mscfd, 4,432 Mscf). Both are well above Sproule's 50 Mscfd threshold. Testing continues for depletion curves.

flow test result

Binding Joint Development Agreement signed with FFS Refiners, executed 10 October 2025, turning the 1 July non-binding term sheet into a firm deal. Phase 1a is about R64.3m (A$5.7m) for five new wells, upgrades, reserve certification and a production right; later phases target a 5,000 tpa LNG plant.

material agreement

PT06 flowed up to 188 Mscfd (average 162 Mscfd) after 14 days of continuous testing, about 98.5% methane, more than double PT10's rate and well above the 50 Mscfd economic threshold. Testing of both wells continues to establish depletion curves.

flow test result

Mxolisi Mgojo, former CEO of Exxaro Resources, was appointed non-executive director effective 3 October 2025 on $60,000 a year excluding superannuation. He is a director of Talent10 Holdings Group, one of Kinetiko's largest shareholders.

director officer appointment

PT10 flowed 92 Mscfd after 16 days of continuous testing, about 99% methane, versus the 50 Mscfd the 2023 Sproule reserve assessment treated as commercially viable. Flow testing at PT06 has started, with results expected in October.

flow test result

Well 271-KA03PT06 reached 405m with a record peak choke-test flow of 1,600 Mscfd, over 3x the best historical test (500 Mscfd, 2013) and 4x PT10. Company suggests earlier wells may be sub-optimal and could be remediated. Stabilised flows still to come.

well test result

Exploration rights ER270, ER271 and ER272 renewed for a further 2 years each. This resolves the open renewal question; total exploration landholding including ER383 is stated as 5,366 km2. Drilling at PT06 is nearing final depth.

regulatory community update

Third test well 271-KA03PT10 reached 417m with 144m net pay and a peak choke-test flow of 370 Mscfd. First well using the optimised methods, after the first two underperformed. Extended testing continues; rig moves to the next well.

well test result

Non-binding term sheet with FFS Refiners for a pilot LNG plant at Brakfontein. A binding agreement is targeted within 30 days, with R20m first-phase funding split Kinetiko 67.5% and FFS 32.5%. Builds on the 2023 FFS MOU; nothing is binding yet.

material agreement

Kinetiko raises about A$2.2m at 4c per share (20% below last trade), with a free option per share at 7c expiring June 2027. Directors take up to A$310k, subject to approval. A A$500k loan is also converted to shares. Follows cash falling to A$441k.

capital raising announcement

Third of five test wells, 271-KA03PT10 at Brakfontein, spudded 9 May 2025 using revised drilling methods from the expert study. It is intended to join a cluster feeding a pilot LNG plant expected in 2026; first gas flow results expected before July 2025.

drilling spud

Final expert report finds water and drilling foam cut gas permeability by up to 85% in lab simulations, blaming drilling methods for the first two wells' poor flows. Resolves the study opened in February; next well to spud early May with revised methods.

well test result

Second well 271-KV06PT reached 631m and has been flared. The company now says its first-well 'small sealed compartment' conclusion was incorrect, and suspects drilling may have created a temporary 'skin' blocking gas flow. A drilling optimisation study precedes continuing the program.

well test result

Chairman's letter says CEO Nick de Blocq is stepping down at year end after three years, for personal reasons. Director Rob Bulder becomes Interim CEO; talks with permanent candidates are well advanced. Also recaps 2024 drilling and calls the first test well's result a geological anomaly.

director officer appointment

First production test well 271-23PT reached 463m on 16 October 2024 but produced no commercial gas in a choke test, so no flow test followed. The company calls it a geological anomaly (a small, sealed compartment). Cost under A$500,000; rig moved to second well.

drilling result

At the company's request, KKO was placed in voluntary suspension pending an announcement on drilling results at well 271-23PT, expected on or before 23 October 2024. Resolves the earlier trading pause's cause; the well result is awaited.

listing compliance notice

First production test well 271-23PT spudded on 27 September 2024, about 5km from Majuba power station. It starts the five-well program of up to 90-day flow tests; completion and first gas flow results are expected by early November 2024.

drilling spud

Final result: 84,266,769 shares issued at $0.06, raising about $5,056,006, 99.99% of the maximum, correcting the earlier 97% figure. Entitlements took 65.76m shares; directors placed 18.51m shortfall shares. No shortfall remains, resolving that open thread.

capital raising announcement

Rights trading began on a renounceable entitlement offer of up to 84,266,771 shares, one for every 16 held, at $0.06 to raise up to about $5.06m. Offer closes 3 June 2024. A new raising at a lower price than the 9c of 2023.

capital raising announcement

On 5 May 2024 gas from the Korhaan-1 well ran a 1.2MW generator for a 4-day trial with FFS Refiners; gas was about 99% methane. First onshore gas-to-power demonstration in South Africa; it supports plans for a roughly 30-well LNG cluster with the IDC. Demonstration only, not commercial sales.

production update

Core hole 270-08C reached 745m, the company's deepest, hitting granitic basement; logs show 137.5m of gassy sandstone pay over 1m thick. Coal desorption is 3-5 m³/tonne. This is a clean success after the two short ER270 holes; two more ER270 core holes planned Q2 2024.

drilling result

Robert Scharnell, a 30-year Chevron executive, was appointed non-executive director from 24 November 2023. Founding director Geoff Michael and Tom Fontaine left after the AGM, ending the pre-merger board's long tenure.

director officer appointment

Infin Drilling has been awarded the contract for five appraisal production wells in southern ER271, now planned from mid-Q1 2024 (Feb 2024 per the CEO), later than the September 2023 start flagged earlier. Production right report is due late Q1 2024; ER320 grant is expected in Q4 2024.

drilling scheduled

Kinetiko completed buying the 51% of Afro Energy held by Badimo, issuing 495,482,590 shares, and now owns 100% of Afro Energy and the Amersfoort project. Badimo's Don Ncube and Rob Bulder join the board. Total shares are 1,348,268,334.

business combination

Talent 10 Holdings committed to fund $6.5m by taking 72,222,222 sell-down shares at 9c, satisfying the last condition to buy the remaining 51% of Afro Energy from Badimo. Completion is expected within weeks; post-merger shares about 1.348bn. Resolves the $6.5m raising thread.

capital raising announcement

Afro Energy signed a non-binding term sheet with the IDC for a new LNG joint venture: a first 50MW-equivalent stage costing about A$138M, with IDC funding about A$52M for 30% and Afro 70%. Scaling to 500MW is intended. Off-take agreements are not yet in place.

joint venture update

Sproule certified maiden gas reserves of 3.1 BCF net (6.4 BCF gross, 2P) over a 6.8 km2, 30-well pilot field. Net 2C contingent resource rose about 20% to 3.0 TCF (6.0 TCF gross), plus 2.8 TCF net prospective. Figures are on Kinetiko's 49% interest in Afro Energy.

resource reserve update

Two rigs mobilised to ER272 near Sasol's Secunda refinery; first well 272-01C spudded 4 May. Core hole 270-05C finished at 597m with 134.5m of cumulative gas intersect, completing the three-hole ER270 campaign.

drilling spud

Afro Energy terminated the proposed 50/50 Vutomi Energy gas-to-power JV because the terms sheet conditions were not met. With generation licences no longer needed up to 100MW, Kinetiko will buy its own pilot generator for Amersfoort. Reverses the earlier Vutomi plan.

material agreement termination

The IDC has advanced R16.3m of its R70m commitment to the Afro Energy joint venture, which has approvals in place. Afro has advanced R20m of its R85m share; field start is now late 2023 (earlier flagged for H1 2023). Total budget about R155m.

joint venture update

ASX refused the waiver to extend the Badimo share-issue deadline to 30 June 2023. The Restructure still proceeds, but shareholders must vote again on a new notice of meeting with an updated independent expert report. Resolves the 1 March waiver request negatively; delays the deal.

listing compliance notice

Non-binding MOU with FFS Refiners, a South African industrial fuels supplier, toward a binding gas supply agreement within 6 months. It plans a proof-of-concept trial in southern ER271 to supply gas for LNG. FFS aims to make LNG from other sources in 2024. Second off-take-type partner after Gruner.

material agreement

Kinetiko missed the 28 February 2023 deadline to issue Badimo transaction shares because the $6.5m Capital Raising is not complete. It has asked ASX for a waiver extending the deadline to 30 June 2023; otherwise shareholders must vote again. Delays the Badimo deal.

listing compliance notice

South Africa's petroleum regulator PASA renewed Exploration Rights 270 and 272 for two years, covering about 3,135 km2. They are the first of up to three possible renewals. The company intends to apply for 30-year production rights over them in the near future.

regulatory community update

Non-binding letter of intent with Gruner Energy to co-fund a proof-of-concept gas production trial in southern ER271, with Gruner buying the gas. A binding supply agreement is targeted within 6 months. It is the first off-take-type partner, but not yet signed commercially.

material agreement

Wireline logs for 270-06C show 147m of gassy sandstone pay, more than the 131m at Majuba. Desorption is nearly 7 m³/t and rising. Gas-bearing geology now extends about 64km south of Majuba, supporting a roughly 125km potential gas fairway.

drilling result

Phefo Power exercised its option, raising A$2.95m at 9c a share through 32,802,220 new shares. This follows its A$5m October placement. Funds are for accelerated exploration; the option was for R35m (earlier noted as R30m).

capital raising announcement

Shareholders approved buying the remaining 51% of Afro Energy from Badimo for 567.7m shares, giving 100% of the exploration rights; earlier text said 597.7m. A $6.5m sell-down of consideration shares, at 7.5c to 15c, funds completion by 30 March 2023. Ncube and Bulder to join the board.

business combination

Majuba core hole 271-23C desorbed over 11 m³/tonne, a project record, with 131.5m of sandstone pay and six coal seams. Hole 270-06C, below 445m, has gassy zones about 30km beyond earlier southern discoveries, extending the known gas area.

drilling result

Core hole 271-23C near Majuba finished at 478m with 247m of gas-bearing rock below a dolerite cap; desorption gas content already up to 9 m³/tonne. Next hole, 270-06C, is the first on ER270 to the south.

drilling result

Kinetiko raised A$5m through a placement of 56.6m shares at 9c (3.2% below last close) from Phefo Power, already a shareholder since April. Phefo also gets an option over R30m of shares at 9c or higher, expiring 28 February 2023. Resolves the suspension.

capital raising announcement

ASX paused trading in Kinetiko securities pending a further announcement. No reason is given in the notice.

other

Sproule engaged for maiden gas reserve certification, due by end of October 2022. Korhaan-3 and -4 described as commercial rates, Korhaan-5 sub-commercial. Vutomi generator due on site in early Q4; Eskom licences issued. Core drilling restarts in September.

joint venture update

First Korhaan flow rates: Korhaan-3 sustained 83,000 scf/day, Korhaan-5 flowed 210,000 scf/day early then declined to a stable 7 Nm³/hour, and Korhaan-4 has been re-entered for retesting. Wells plus older ones expected to supply 200,000-250,000 scf/day for pilot production.

well test result

Rights issue closed raising only A$1.7m (22.66m shares at 7.5c) against the ~A$3.1m target, though above the $1.5m minimum. With Phefo, total is about A$2.7m. Remaining shortfall is to be placed by 30 June.

capital raising announcement

Kinetiko raises about A$4.1m: ZAR10m (30m shares) from South African investor Phefo Power, plus a 1-for-15 renounceable rights issue at 7.5c to raise up to A$3.1m, partially underwritten to $1.5m by Mahe Capital. Phefo also boosts BEE ownership.

capital raising announcement

Afro Energy signs a joint development agreement with South Africa's state-owned IDC for a roughly 20-well gas field on ER271: IDC puts in R70m for 45%, Afro R85m for 55%. Binding loan agreements are due by 1 August 2022; this is the long-awaited institutional funding, with field start expected late 2022.

farm in farm out agreement

South African ministerial consent obtained for transfer of Badimo's 51% of Afro Energy to Kinetiko, described as the last regulatory approval needed; shareholder approval is still required. Resolves a key condition of the Badimo deal covering the 4.9 Tcf 2C resource.

regulatory community update

Interpretation of the third aeromagnetic survey found 42 new gas-prospective compartments (264 km2), taking the total from 37 to 79 compartments covering 1,229 km2. These are prospective targets, not a booked resource.

resource reserve update

Korhaan-5 reached 432m with gas throughout the production section, and Korhaan-3 hit substantial gas in its surface section at 177m. Korhaan-4 is logged and flow testing is due next week. The company claims a 100% gas discovery success rate; flow rates are still unmeasured.

drilling result

Binding agreements signed to lift Kinetiko's Afro Energy stake from 49% to 100% by issuing 597,704,812 shares to Badimo, who would hold about 46% afterwards. Needs shareholder approval and an independent expert report. Resolves the May terms sheet into binding documents.

business combination

Afro Energy signs a non-final terms sheet for a 50/50 JV with Vutomi Energy to generate and sell electricity using Afro gas and a free-loaned 1MW engine. A binding agreement is to be negotiated within 90 days. A small first step toward gas sales, not the gas traders' off-take.

joint venture update

Korhaan-4 reached 443m, the longest production interval in the Amersfoort area, with robust gas flows observed under choked conditions. Regulated flow testing is planned for early January 2022. A first positive result from the new campaign, though not yet a measured flow rate.

drilling result

First of three Korhaan wells, Korhaan-4, spudded using air/percussion drilling to about 450m, ending the long gap in new drilling. Korhaan-3 is expected the week of 15 November; flow rates will be assessed after Korhaan-4 completes.

drilling spud

Badimo merger conditions are satisfied and tax structuring settled, so the definitive share purchase agreement can be signed, with completion targeted this year. A South African institution has decided to invest in a pilot field, documents being drafted. Drilling is now expected early Q4.

joint venture update

South Africa's Minister approved merging ER56, ER38 and ER271 into one 1,287 km2 ER271. This lets Afro apply for a single production right over the Amersfoort area, continuing the production-right plan. Approval letter dated 19 August 2021.

regulatory community update

Three new wells (KA-03PT7, PT8, PT9) are planned and approved, within 400 m of the gas terminal, with rigs expected on site in September and completion by November. With existing wells they could form a 5-well pilot cluster. First new drilling on the project in over 6 years.

drilling scheduled

Nick de Blocq, with 33 years in oil and gas across Africa, is appointed CEO on A$240,000 a year plus 2m options at 10c expiring July 2024. He succeeds long-standing CEO Johan Visagie, who is retiring.

director officer appointment

Kinetiko raised about $2.8m via a placement of roughly 28m shares at 10c, plus a Share Purchase Plan for up to $2.0m at the same price. Funds go to drilling and surveys, and the chair says the SPP helps complete the Afro Energy acquisition. First outside raising in over 4 years.

capital raising announcement

Binding terms sheet to buy Badimo's remaining 51% of Afro Energy for about 595.6m new shares, making Kinetiko 100% owner of the South African rights. Badimo holders would own about 46% of the company. Needs shareholder approval and an independent expert; $6.5m of shares to be sold to investors.

asset acquisition disposition

Well KA-03PTR flow test achieved initial open flow up to 650 Mscfd and an average of 190 Mscfd, with gas over 96% methane. Management says this supports immediate production. It is a small rate; the well made about 25.5 MMscf in 2013.

flow test result

Tom Fontaine, a CBM engineer who co-founded Pure Energy (sold to British Gas for over A$1bn in 2009), joins as non-executive director. Chair Adam Sierakowski becomes Executive Chairman on $190k a year from 9 February 2021.

director officer appointment

Early exercise of 3c options raised $1.26m, about 81% of that option class, with about $287,000 possible from the rest. Funds are for well workovers, first CNG gas production, survey interpretation and core drilling. This delivers the option funding flagged in October.

capital raising announcement

Workover of existing wells has begun for pilot gas-to-CNG production near KA-03PTR in ER56, with completion due mid-December 2020 and first gas expected early 2021. Advanced talks with gas traders as buyers. Follows the October production approval; first revenues would be the aim.

production update

Afro Energy won approval to produce and sell up to 500 mmscf of gas a year for two years from ER56 and ER38. This opens a path to first revenue and first reserves from a pilot field; a full production right would be sought later.

regulatory community update

Gustavson lifted the Amersfoort contingent resource (2C, gross) from 1.5 Tcf to 4.9 Tcf (up 227%), and prospective gas in place from 2.4 to 9.3 Tcf. Kinetiko's 49% share of 2C is about 2.4 Tcf. Excludes pending ER320; aeromagnetic data may allow a further revision.

resource reserve update

Exploration restarts at Amersfoort after about six years, with an 11,563 line-km aeromagnetic survey over 474 km2 (mostly ER38) planned to sharpen well targets. It could support a revision of the 1.5 Tcf resource, as the 2014 survey did.

drilling scheduled

ASX will lift Kinetiko's suspension from 18 May 2020 after it showed compliance with listing rule 12.2. Trading resumes after suspension since October 2017, resolving the long-running re-quotation thread.

listing compliance notice

The 2-cent entitlement offer closed with shareholders taking up 64,135,945 of 102,023,068 shares (about $1.28m), leaving a shortfall of 37,887,123 shares. The board will allocate shortfall applications in coming weeks. This is below the full $2.04m possible.

capital raising announcement

A 1-for-4 entitlement offer at 2 cents to raise up to about $2.04m, plus a placement of up to 50m shares at 2 cents for $1m. Funds go to Amersfoort exploration, meeting ASX requirements to lift the suspension, and working capital. Not underwritten; closes 27 February 2020.

capital raising announcement

Kinetiko lodged its half-year report after finishing Afro's 2016-2019 accounts with Badimo, ending the audit impasse. Its South African investment is restated to $7.4m, after earlier impairment (previously carried at $10.5m at June 2017). Both partners agreed a work program.

asset acquisition disposition

On 17 January 2020 PASA renewed Amersfoort rights ER38 and ER56 and granted new rights ER270-272, taking Afro's holdings to 4,604 km2 (up 378%). This resolves the long-running renewal thread. Kinetiko (49%) has applied for reinstatement and expects its audits done within 7 days.

regulatory community update

Kinetiko has received $180,000 in 12% convertible loans since 3 September, with $20,000 more due. They include $30,000 from chair Sierakowski and $50,000 from major shareholder Brendan Gore. Loans convert at 2 cents, subject to shareholder approval at the AGM, or are repayable in cash after 6 months.

debt financing

June 2019 quarter report: Badimo has cooperated on the ER38/ER56 renewals, which PASA has recommended to the DMR, and they have agreed to complete Afro's overdue audited accounts by end of August 2019. This reads as the end of the impasse. Re-quotation is the goal but the shares remain suspended.

quarterly activities report

The offer closed with applications for 40.07m shares, or $801,466, against a maximum of about 71.2m shares, leaving a shortfall of 31.2m shares. The board may place the shortfall within three months. Roughly 56% of the target was raised.

capital raising announcement

Prospectus for a 1-for-4 non-renounceable entitlement offer of up to 71,239,542 shares at 2 cents to raise about $1.42m, closing 22 November 2018. Not underwritten. Follows the August 2018 signal of a raising backed by major shareholders.

capital raising announcement

Pressure and flow testing restarted on the KA-03PT well at Amersfoort, which flowed up to 330,000 scf/day and produced 26 MMscf in earlier tests. Joint cost is about A$950,000, of which Kinetiko pays over A$35,000. First field work after years of delay.

well test result

Replying to ASX on the annual report: the auditor issued a disclaimer of opinion because it could not access Afro Energy's records, and the $10.48m investment in Afro is 97.5% of total assets. Kinetiko says it is pursuing insolvency proceedings against Badimo and still meets listing rule 12.2.

listing compliance notice

ASX suspended Kinetiko's shares from 4 October under listing rule 17.3 until the company demonstrates compliance with listing rule 12.2 on financial condition. This follows the earlier cash queries and the 3 October announcement.

listing compliance notice

Kinetiko has applied to renew ER38 and ER56 for two years and for a new bulk sampling permit, and has started debt recovery of about $370,000 against Badimo Gas, preparing a liquidation application. The company says it is owed about $2.25m by Afro Energy and Badimo. This is a break with its JV partner.

joint venture update

Placement completed, raising $305,000 at 2.5 cents (12.2m shares), a 17% discount to the 3.0 cent close. This closes the placement proposed on 8 May. Funds go to funding talks in South Africa, exploration and working capital.

capital raising announcement

Kinetiko plans a placement of up to $300,000 (12 million shares at 2.5 cents) from major shareholders for working capital and Afro Energy exploration. It says its loan to Afro is about $2.55m and names IDC and Tosaco Energy as interested funders.

capital raising announcement

Placement raises $850,000 at 2.5 cents per share, a 29% discount to the 3.5 cent close, with a free 3-cent option per share expiring in 24 months. About $246k of loans and $230k of director fees are settled in shares and options, for a total cash benefit of about $1.326m.

capital raising announcement

IDC's Executive Policy Committee declined on 2 June to fund the Amersfoort pilot, citing planned litigation against a Badimo stakeholder, after an equity term sheet signed 15 February. This ends the long-awaited funding. Kinetiko plans a placement or rights issue.

material agreement termination

At the company's request, shares were suspended from 24 February 2016 pending an announcement on project funding and capital raising. The company expected this to be released around 9 March 2016. Trading in the shares is frozen until then.

other

Gustavson's updated estimate lifts 56ER P50 (2C) contingent resources to 655.7 bcf. Gas in place P50 is up 28% (1,083.2 bcf), with the sandstone portion up 55%, on the 2012 estimate. It covers about 32% of the prospective geology across 56ER and 38ER.

resource reserve update

Regulators approved a further 8 wells near KA-03PT and renewed ER56 and ER38 for two more years at Amersfoort. Work is planned over six months from Q1 2016 to enable gas sales under the bulk sampling permit. IDC due diligence continues; funding is not yet committed.

regulatory community update

Kinetiko raised $584,400 through a placement at 3.5 cents, a 22% discount to the last close, issuing 16,697,138 shares. Funds go to partner negotiations, exploration and working capital. Chairman says the December 2014 raise lasted about 8 months.

capital raising announcement

South Africa's mineral resources department permitted Kinetiko and Badimo to remove and sell up to 500 mmscf of gas a year for 2 years from ER56 and ER38. At an assumed US$8/GJ, the company estimates about US$8m of revenue if fully produced and sold. It is a first of its kind in South Africa.

regulatory community update

Afro Energy received a non-binding funding interest letter from South Africa's state-owned Industrial Development Corporation. An agreed work program of well clusters and a gas terminal could allow first revenues within 6 months and maiden reserves in 2016. This is not yet committed funding.

joint venture update

Kinetiko and Badimo settled all disputes, including the cash calls. Kinetiko's application to take Badimo's 51% was withdrawn and the 2010 farm-out terminated. Amersfoort will move into a new JV, Afro Energy, owned 51% Badimo and 49% Kinetiko, so Kinetiko stays at 49%.

joint venture update

Kinetiko raised $550,000 via convertible notes from sophisticated investors including directors, at 12% interest, converting at $0.03 per share (19.25m shares if fully converted). Funds keep tenements in good standing and provide working capital; conversion needs shareholder approval. Note text gives a 24 May 2014 maturity, likely a typo (inference).

capital raising announcement

Kinetiko was granted 12 prospecting gas licences covering 7,093 km² in Botswana's Karoo Kalahari Basin, 100% owned, with an initial two-year term. This resolves the May 2013 application and will follow the Amersfoort exploration approach.

asset acquisition disposition

Johan Visagie, already consulting as project manager, will become CEO by end of March quarter 2015, ending the interim joint-MD arrangement. The Badimo 51% transfer has gone to the Minister for Mines. Kinetiko holds 49% and is in advanced talks with several BEE energy companies.

director officer appointment

Kinetiko issued Badimo a withdrawal notice after about A$1.4m of unpaid cash calls, deemed to transfer Badimo's 51% of Amersfoort to Kinetiko, giving 100% once regulators approve. Badimo may contest. Also: a strong aeromagnetic result and a Standard Bank advisory mandate.

joint venture update

An external review found Amersfoort's gas has come mostly from sandstones, not coals, and the open-hole well design is sub-optimal. Two appraisal wells are planned from June 2014 and a 5-well pilot field concept. This reframes earlier flows; coals are not yet depressurised.

drilling result

Kinetiko signed a legally binding six-month MOU to form a JV with White Rivers Exploration over 716km² of Karoo Basin gas permits (Heilbron, Kroonstadt, Ventersburg). Kinetiko would operate with 50%. The permits are applications, accepted but not yet granted.

material agreement

The board terminated Andrew Lambert as managing director; he has six months' notice and will help with the transition. Directors James Searle and Geoff Michael become joint interim managing directors while a replacement is sought. No reason is given.

director officer appointment

Kinetiko raised about $1.7m via a placement of roughly 11.34m shares at 15 cents, a 22% discount to the 5-day average price. Argonaut was sole lead manager. Funds go to a pilot 5-spot field, core drilling and permit appraisal; the price is below the 18 cents of December 2012.

capital raising announcement

Kinetiko signed a mandate on 8 November with Argonaut as joint corporate adviser alongside Trident Capital and as exclusive financier for developing the Amersfoort project. No fee or funding amount is given. (Inference: a funding raise may follow.)

material agreement

Kinetiko spudded KV-04PT, the first pilot well on the southern Volksrust licence (38ER), replacing the planned northern KA-07PTR as the third well. Eleven core holes there show gas over 690km². Coal is deeper at 400-500m+, and higher pressures are expected.

drilling spud

KA-03PT2 flowed spontaneously at 24,000-25,000 scf/d with no pumping, 330m from KA-03PT (up to 350,000 scf/d earlier). Six of seven northern pilot wells have now flared gas; the seventh failed. Rates are modest versus KA-03PT.

flow test result

The regulator accepted three Exploration Right applications covering about 4,288 km² near Amersfoort, 66% of the three TCP areas kept. TCP38 was relinquished as not prospective. Further submissions are due by 4 December 2013 before government evaluation.

regulatory community update

Badimo paid about $1.1m of the overdue cash calls, resolving the funding dispute raised in June. An audit process is agreed to prevent repeats. Amersfoort is funded to Q1 2014, drilling restarts, and maiden reserves are now targeted by Q1 2014.

joint venture update

Redrilled pilot well KA-10PTR flowed a stabilised 45 Mscf/day over 10 days, versus 332 Mscf/day at KA-03PT 8 km away. Kinetiko says initial studies suggest such rates can be commercial. KA-05PT is dropped. Maiden reserves now late Q4 2013; funded to April 2014 if Badimo pays.

flow test result

Badimo owes Kinetiko $1.3m (up to $1.6m by 30 June); Kinetiko threatens enforcement if unpaid by early July. Drilling suspended except the KA-10PTR redrill, and further drilling is deferred. Maiden reserves slip to Q4 from Q3. Cash is $1.3m excluding Badimo.

joint venture update

Kinetiko applied for 10,500 km² of exploration tenure in central Botswana (11 areas, Kalahari Karoo Basin), a new country beyond South Africa. Grant is expected in July; first-year commitment is at least A$330,000. Early-stage frontier area.

asset acquisition disposition

First pilot well KA-03PT flowed a stabilised 332 Mscf/day at 25 psi of well head pressure, with dry gas above 95% methane and minimal water. Sandstones gave most of the gas. The JV now targets initial 3P/2P reserves by mid-2013, slipping from April.

flow test result

Kinetiko completed a placement raising about $3m at 18.0 cents per share, a 10.5% discount to the 5-day VWAP, issuing about 16.5 million shares. Proceeds will fund pilot and core hole drilling at Amersfoort, structural studies, preliminary appraisal of its TCPs and working capital.

capital raising announcement

Second pilot well (KA-10PTR) was drilled to 440 m and flared gas above 308 m. Company says preliminary flows exceed expectations, with flow tests to confirm over coming weeks. Similar results 8 km apart are described as very positive for commerciality; this is not yet a measured rate.

flow test result

Replacement first pilot well (KA-03PTR) reached 250 m and flared substantial spontaneous gas from shallow sandstone. The company says pressures and flows exceed expectations, but this is preliminary until flow equipment is installed. Stage 2 will deepen to about 370 m.

flow test result

First Amersfoort pilot production well (KA-03) spudded, planned under 450 m deep, with flow rates and recoverability expected within 4-6 weeks. The rig will do three wells on the northern licence by early 2013. Reserves still aimed for early 2013.

drilling spud

The regulator approved the Amersfoort pilot production well programme, resolving the open approval thread. Drilling is due to start end September and finish February 2013, aiming for reserves by Q1 2013. A second core rig is added at Volksrust.

regulatory community update

Gustavson raised Amersfoort gas in place from 1.7 to 2.4 tcf (P50, +41%) and contingent resource from 1.1 to 1.5 tcf (+36%). The gain comes from shallow sandstone gas found in all ten holes, flagged earlier as upside. Pilot wells are planned for September, with reserves hoped for early 2013.

resource reserve update

All four TCP applications were granted, covering 7,911 km² at 100% Kinetiko. Gustavson estimated P50 prospective gas in place at 9.3 tcf using a more conservative method, below May's 10.7 tcf estimate for three areas.

regulatory community update

The Volksrust (38ER) exploration right was renewed, but 20% of the area was relinquished, cutting the combined Amersfoort and Volksrust area to 1,601 km² from 1,874 km². Drilling there is due in June, pilot wells from August. Funding stated as at least 14 months.

regulatory community update

Gustavson estimates the three permit applications (6,150 km², still pending) hold 10.7 tcf gas in place and 6.9 tcf contingent resource at P50. This is on top of Amersfoort. It relies on regional data and assumptions rather than drilling on those areas, and permits are not yet granted.

resource reserve update

After strong early gas results, Phase 1 at Amersfoort expands by two holes, and pilot production wells rise to up to eight, starting July 2012 subject to approval. Volksrust drilling is due to begin in May. Company says it is funded for at least 16 months.

drilling scheduled

Gustavson reviewed early desorption data from three holes and supports a P50 Contingent Resource of 1.12 tcf at Amersfoort, which the company calls a confirmed discovery. Logs suggest possible conventional gas, which is not in that figure. This confirms the earlier estimate rather than raising it.

resource reserve update

Hole KA-06 (366 m) is spontaneously emitting high volumes of methane, and other holes also show gas. The 8-hole program on 56ER is 60% done. Permeability test wells are planned for mid-2012. This builds on the early gas shows from the first hole.

drilling progress report

Kinetiko signed an MOU with JV partner Badimo Gas giving it a first right to develop Badimo's exploration right applications over about 7,086 km². If all applications are granted, Kinetiko's potential area totals 16,635 km². Badimo's applications are still being negotiated with PASA.

material agreement

The first Amersfoort hole was completed at 425.7 m, with visible gas bubbles from carbonaceous mudstones. Core samples are in desorption testing, so no gas volumes yet. A second rig has started the third hole. The company calls it an early positive step.

drilling result

PASA accepted Kinetiko's application for a Technical Commercial Permit over about 4,200 km² south of Amersfoort, with a decision due in 3-6 months. If granted, it gives exclusive rights to apply for an exploration right. This starts a land-growth strategy.

regulatory community update

Kinetiko's IPO prospectus offers up to 40 million shares at 20 cents to raise $8 million, with up to $2 million more in oversubscriptions. It is a coal bed methane explorer, and the prospectus calls the investment speculative.

capital raising announcement