Makoba leaves OP for controversial ReconAfrica

  • Makoba appointed middleman between govt and company
  • Canadian firm seeks partnership with govt for oil exploration in the Okavango
  • Experts have warned there is no oil in northern Botswana


Ame Makoba has left his job as the Private Secretary to the Minister of State to join controversial Canadian company, ReconAfrica, which is seeking to partner with the government for exploration and mining for oil in the ecologically-sensive Okavango Delta.
While Makoba was unavailable for comment at the time of going to press, The Botswana Gazette is reliably informed that he has assumed the role of Director – Government and Stakeholder Relations, at ReconAfrica. According to sources, his contract came into effect on 1st August 2022.

“Very close”
It said Makoba is expected to play an instrumental role in facilitating the deal for an oil mining partnership between the government and ReconAfrrica despite a warning by experts that there is no oil in northern Botswana.

Sources say Makoba and President Mokgweetsi Masisi enjoy “very close” relations. “President Masisi was the one who recommended that Ame Makoba become Minister Kabo Morwaeng’s Private Secretary,” said the source. “He will be the middleman between the government and the company.”

The Canadian oil company, Reconnaissance Energy Africa (ReconAfrica), was awarded a licence to explore for oil in a 13,200 square mile area between Namibia and Botswana late last year. The area includes part of the vital watershed of the Okavango Delta, one of the largest inland deltas in the world.

Several activist groups have strongly condemned oil exploration in the delta, arguing that oil and gas exploration will negatively affect and disturb nature in the area. BaSarwa living there have mulled the possibility of taking both governments to the African Court of Human and Peoples’ Rights.

Furthermore, The Gazette has gathered evidence that suggests that ReconAfrica’s project could be a potential petroleum pump-and-dump scheme aimed at defrauding investors.


Pump-and-dump scheme
A pump-and-dump scheme is a securities fraud that involves exaggerating the value of stocks through misleading positive statements and publications. In the case of ReconAfrica, this would involve misinterpreting and manipulating data from test wells in Namibia to boost share values before offloading stocks to make huge profits.

Transactions on the Canadian Stock Exchange are public records and can be accessed online. Over the past 12 months, ReconAfrica directors have sold company shares (publicly traded as RECO) for a significant profit.

Nicholas Steinsberger (Senior Vice President, Drilling and Completions) sold 122,000 shares, Anna Tudela (Corporate Secretary and Chief Compliance Officer) sold 92,206 shares, Carlos Escribano (Chief Financial Officer) sold 85,000 shares, Ian Telfer (Director of Renaissance Oil that purchased a 50% interest in profits generated from the Botswana lease) sold 71,732 shares, James Wilton Granath (Independent Director of Reconnaissance Energy Africa) sold 40,000 shares, Scot Evans (CEO of ReconAfrica and Director of Reconnaissance Energy Botswana) sold 35,000 shares in the company, and Gordon Keep (Independent company director) sold 18,748 shares.

Every single registered share sale over the past 12 months has been sold by a director of ReconAfrica.


More details
In 2019, RECO shares were valued at $0.25. Following their claims of a significant oil discovery in Botswana and Namibia, RECO shares hit a high of $11.74 in July 2021. The offloading of these RECO shares would have netted ReconAfrica company directors millions of dollars.


Investors secretly selling off shares
Frederick M. Lehrer, a former US-based SEC enforcement attorney who has more than 20 years’ experience in corporate finance and securities law, told National Geographic: “The big question for investors is why insiders were secretly selling their shares while promotional materials touted the company’s prospects.”

As a result, ReconAfrica is currently under a class action lawsuit in the US where plaintiffs from the Eastern District of New York claim that the 1,600% increase in ReconAfrica stock prices over the past 12 months is based on a concerted campaign of paid stock promotion and opaque press releases aimed at unsophisticated investors.

Erica Lyman is a professor of global law at the Lewis & Clark Law School in the US. She explains: “Petroleum pump-and-dump schemes are a legitimate concern, and they can come with real financial costs to investors, including government partners, when the promised returns never materialise and share prices crash.”


How much is it worth?
Craig Steinke, Executive Chairman of ReconAfrica, purchased the Botswana exploration lease for P69,447, renewable on an annual basis. In a complex series of transactions that followed, it appears that Steinke sold an option for 100% of the working interest of the lease to ReconAfrica for 30 million shares in the company. Renaissance Oil then purchased half of the exploration licence.

Reconnaissance Energy Corp purchased Renaissance Oil, which was owned by Craig Steinke, for a reported $155 million USD. As of September 2021, ReconAfrica published a consolidated interim financial statement where the company valued the Botswana lease at just over $105 million USD, having never completed a single exploration test within the lease area.