ReconAfrica (RECAF) CAD $9.4M Kavango Area Issues U.S. Settlement

Eligible claimants can submit their claims for compensation.

E.D. New York

Court

1:21-cv-06176

Case number

02/28/2019

Class period Start

12/06/2021

Class period End

01/09/2025

Claim deadline

Reconnaissance Energy Africa (RECWF) agreed to settle CAD $9.425M with investors to end claims over hiding unconventional means for energy extraction in the fragile Kavango area. They are also paying CAD $5.07M settlement to Canadian investors for the same case.

Case Details:

Between October 2020 and September 2021, investors were informed of issues with ReconAfrica's energy operations in Namibia and Botswana.
These included unconventional extraction, unlicensed drilling, illegal tests, legal violations, improper hiring, and community info lack.
In a report released on September 7, 2021, Viceroy Research criticized ReconAfrica's handling of data from their 6-2 well, calling it an attempt to spin disappointing results.
They pointed out unreadable logs, misleading interpretations of water saturation, and the need for fracking, which is illegal in Namibia.
As a result, shares dropped by 12% the same day.

Based on these events, ReconAfrica and its leaders were accused of hiding or misleading about the following details:
They planned unconventional extraction methods like fracking in the fragile Kavango area.
ReconAfrica conducted unlicensed drilling, illegal water usage, and violated laws, risking future licenses.
They also failed to inform locals and focused on the Owambo Basin instead of the claimed Kavango Basin.
ReconAfrica has now decided to end all allegations related to the Kavango area business by paying a CAD $9.425M settlement to investors. They are also paying CAD $5.07M settlement to Canadian investors for the same case.

Case Status

Accepting Claims

Alleged Offence

Misleading Statements,

Failure to Disclose,

Omissions

Suspected Party

Directors,

Management

Security Type

Depository Securities (ADS, ADR, GDR)

Trade Direction

Long

Filing date

10/25/2021

Lead Plaintiff Deadline

12/27/2021

Plaintiffs

Jeff M. Owen,

Attorneys

Glancy Prongay & Murray LLP (Los Angeles, CA)

Defendants

James Jay Park, Scot Evans, Ian D. Brown, Carlos Escribano, Shiraz Dhanani, Mark Gerlitz, James Granath, Claire Preece, Ndapewoshali Shapwanale, Chris Gilmour, Sindila Mwiya

Judge

Hon. Frederic Block

Administrator

EPIQ

Settlement agreement date

2024-08-15

Court hearing date

12/19/2024

Exclusion deadline

11/28/2024

Objection deadline

11/28/2024

Attorney fee

$2,706,250

Trades matching type

FIFO

+$9,425,000

Cash Settlement Amount