Finance, Economic Development and Investment Promotion Minister Professor Mthuli Ncube says Zimbabwe has taken a decisive step towards becoming an energy-producing nation after signing a landmark Petroleum Production Sharing Agreement (PPSA) linked to the Cabora Bassa oil and gas project in Muzarabani and Mbire districts.
Speaking at the signing ceremony, Prof Ncube said the agreement establishes the stable fiscal and regulatory framework required to unlock investment, accelerate exploration and position Zimbabwe as a future petroleum producer.
“The agreement we are signing today provides for a stable fiscal and regulatory framework to facilitate petroleum exploration, development, production and marketing in Zimbabwe,” said Prof Ncube.
“Government appreciates the significant capital, technology, expertise and risk that investors have undertaken in this petroleum exploration project. Accordingly, we continue to refine our policies and legal framework to ensure that Zimbabwe remains competitive regionally and globally while safeguarding national interests.”
The agreement, signed between Government and Geo Associates under Special Grant 4571, provides legal certainty governing the entire petroleum value chain, from exploration and production to commercialization and eventual decommissioning.
For Zimbabwe, the deal represents far more than a routine mining agreement. It is the latest milestone in a project that could potentially transform the country’s energy sector, reduce dependence on imported fuel and create a new source of export earnings.
The agreement comes after years of exploration by Australian energy company Invictus Energy in the Cabora Bassa Basin, one of Africa’s largest underexplored onshore sedimentary basins.
Invictus Energy Managing Director Scott Macmillan said drilling results from the Mukuyu-1 and Mukuyu-2 wells have already confirmed the presence of natural gas and condensate within the basin.
“Mukuyu-2 has declared a discovery and Mukuyu-1 subsequently a discovery of natural gas and condensate as well,” Macmillan said.
“We’ve taken the time now to integrate those results from drilling into our geological models and our seismic data to understand what’s in that part of the basin.”
Macmillan noted that despite the discoveries, exploration remains in its early stages.
“The Cabora Bassa Basin we are exploring is a large basin and it’s still in its very early days. We’ve only drilled two wells in what is a very large area,” he said.
Since entering Zimbabwe in 2018, Invictus has completed extensive geological studies, seismic surveys and exploratory drilling programmes aimed at determining the commercial potential of the basin.
The company is now preparing to drill the Musuma-1 exploration well later this year as part of efforts to further define the extent of oil and gas resources across the basin.
Invictus is also advancing plans for a gas-to-power project expected to supply electricity to Eureka Gold Mine near Guruve. The project is viewed as an important proof of concept for future commercial utilisation of locally produced natural gas.
Industry analysts say successful development of the resource could significantly reduce Zimbabwe’s fuel import bill, improve energy security and stimulate industrial growth through cheaper and more reliable energy supplies.
Mines and Mining Development Minister Dr Polite Kambamura described the agreement as one of the most significant petroleum sector deals signed in the region.
“As Minister of Mines, the execution of this PPSA marks a defining moment in the advancement of Zimbabwe’s petroleum sector,” he said.
“It is one of the signature agreements that have been signed in this region and we look forward to seeing much progress after the conclusion of this agreement. It will open doors for more funding for the project.”
The signing is expected to improve investor confidence by providing clarity on fiscal terms and revenue-sharing arrangements should commercial production eventually be achieved.
Nearly seven years after exploration activities began in the Cabora Bassa Basin, Zimbabwe remains in the exploration phase. However, two confirmed discoveries, a new production-sharing framework and further drilling planned for later this year have strengthened optimism that the country may be edging closer to a breakthrough in its quest to establish a domestic petroleum industry.
Should commercial production materialise, the project could become one of the most consequential energy developments in Zimbabwe’s post-independence history, with implications for energy security, foreign currency generation, industrial development and long-term economic growth.
