Despite positive drilling results in Zimbabwe, Invictus Energy ran into headwinds at its AGM, with shareholders opposing a number of resolutions and chairman Stuart Lake opting to leave.
Voting at the event yesterday saw two resolutions only narrowly pass, while resolution 11 was not passed, with approval of only 49.39%.
The three resolutions focused on the issue of new shares. The resolution that did not pass was the employee securities incentive plan.
Resolution 11 would have given the company authority to issue up to 43.8 million shares, with the intention to “attract, motivate and retain key employees”. The company would have had the option of granting these over three years.
The resolution’s failure will reduce the number of shares the company can issue to keep employees. The company has 874.9 million shares currently.
Resolutions 9 and 10 received support from only 52.75% and 51.49% respectively. Shareholders approved the other resolutions with ranges of 87.95% to 96.96%.
Invictus did not immediately comment on the results of the voting.
The votes come despite the progress that Invictus has made in Zimbabwe. The Mukuyu-1 well has reached a measured depth of 3,923 metres, with the company reporting elevated gas shows.
Managing director Scott Macmillan said the results were encouraging, despite some issues with wellbore stability. The company plans to drill a sidetrack to gain further insight, after being unable to run wireline logs beyond a depth of 3,030 metres.
When the company drills the sidetrack, it will have the benefit of knowledge gained from the first well, Macmillan said. “We had to be conservative with mud weights and well design,” he said.
“We’ve had a difficult time drilling this basin, because it’s the first well, but it’s been worth it to have a result like this. We’re very pleased that we’re nearly there,” Macmillan said. “It’s disappointing we have to execute the sidetrack but it gives us a much better opportunity of fulfilling the ultimate objective of this well.”
The Mukuyu-1 results are a “dream deferred”, he said.
Invictus’ Lake said it had been a “sincere honour” to serve as a non-executive director and chairman. In a statement, he said that personal circumstances meant he could not provide the needed time and focus for the role. He is stepping down effective as of November 28.
Lake’s exiting statement highlighted the progress that the company had made. The well had found hydrocarbons, which marks a first step for “energy independence for Zimbabwe and the ability for Zimbabwe to supply energy to adjacent countries”.
The chairman noted that during his time at the company it had accomplished a number of goals, including receiving four farm-in offers.
Lake continues to be a shareholder in Invictus. He said that if his circumstances change, he would be open to returning.