Article

Anatomy of a billion dollar oil and gas investor scam

According to local groups, international research firms and National Geographic, ReconAfrica’s unsustainable search for oil and gas in the Okavango Delta watershed is a political and environmental scandal. Our team’s new research into the financial dealings of the company shows that it is most likely also based on a financial scam perpetrated by ReconAfrica on small retail shareholders who have been hoodwinked into buying its worthless stock.

One of ReconAfrica's drill sites in Namibia.
One of ReconAfrica's drill sites in Namibia.

On the 18th of August, the Women's Leadership Centre (WLC) based in Windhoek, Namibia, hosted a 100-minute deep-dive of ReconAfrica’s oil drilling activities which threaten the Okavango Delta. A panel of civil society activists and international experts slated the company’s false announcements, their poor environmental compliance and the possible theft of local property for their drilling sites. Watch the full presentation here.
I am the founder of NOAH Advisors and NOAH Conference. We have been working for a quarter of a century with the world’s leading entrepreneurs and digital investors, driving capital towards startups. Since 2019, I have focused my efforts on supporting businesses that provide a sustainable future for the planet. You can find more information on NOAH in this presentation.
I am an investment banker who became an activist because I cannot accept that our most precious natural assets are unprotected in a world rendered powerless by fake news, short-term corporate interests and complex global interdependencies. Our team has been following ReconAfrica’s stock promotion campaign for the last six months and my WeDontHaveTime and LinkedIn posts about the company’s dubious activities have been read by over 30,000 people globally.
ReconAfrica, through paid-for online publications like Oilprice.com, says they are sitting on the biggest onshore oil discovery of the decade. But our research following the money and investors’ capital shows that the company is simply a prefabricated online marketing campaign using digital advertising methods to make this fake news appear a reality.
If the company’s purpose is not to pump oil but to pump stock, as the research firm Viceroy alleges, then they have been fabulously successful. This tiny oil company with few assets, no oil in place and zero earnings has grown to nearly a billion-dollar company in the last year alone.

The red arrows mark ReconAfrica's drill sites in the KAZA TFZA area (white frame).
The red arrows mark ReconAfrica's drill sites in the KAZA TFZA area (white frame).

Despite announcing in April that they had found “a working petroleum system” in the supposed “newly discovered” Kavango Basin, the company has shown no independent analysis to back up these claims. The announcement did however coincide with a massive and potentially illegal online marketing campaign that pumped the stock price from 2 to 10 US Dollars in just six weeks.
Since that June high, the company’s shine has dulled with little follow-up as experts slated the company’s inability to back up their claims with any shred of verifiable evidence. Today the stock price is down to just below 5 US dollars, which we feel is still ridiculously inflated, considering that absolutely zero proof of this supposed massive discovery has been provided by ReconAfrica.
ReconAfrica’s ongoing drilling program is being conducted in the world’s largest protected international wildlife reserve, the Kavango–Zambezi Transfrontier Conservation Area (“KAZA”), covering five nations, -an area bigger than France. This massive park protects the world’s largest remaining herd of endangered elephants as well as dozens of other endangered species, like the Slaty Egret and Temmincks ground pangolin, which has been nearly poached to extinction.
The interlinked Kavango River, Okavango Delta and the Omatako ephemeral underground river which flows past ReconAfrica’s drill sites support almost a million people with sustainable livelihoods. The company’s drilling operations are already potentially damaging local water supplies in violation of Namibia’s environmental laws. For example, ReconAfrica dumped its produced drilling water into unlined pits, according to the World Wide Fund for Nature (WWF) and National Geographic.

The Okavango Delta, a UNESCO World Heritage site, and one of the very few major interior delta systems that do not flow into a sea or ocean, with a wetland system that is almost intact.
The Okavango Delta, a UNESCO World Heritage site, and one of the very few major interior delta systems that do not flow into a sea or ocean, with a wetland system that is almost intact.

Not all local people living within the license area have given their free, prior and informed consent to having these damaging and polluting operations take place in their communities.
KAZA is funded by Germany’s KfW Development Bank, German Federal Ministry for Economic Cooperation and Development, Deutsche Gesellschaft für Internationale Zusammenarbeit GmbH (GIZ), The World Bank and other organisations. It appears that none of these institutions have stepped in to question the dubious drilling operations on the land they claim to protect. NOAH decided to align with civil society groups in the region in order to use our financial expertise to investigate and expose this scheme for what we believe it is: a fraud perpetrated on the peoples of Namibia by a foreign company in league with possible criminal elements.
ReconAfrica’s financial filings show that their share price was pushed up by a $2-3 million annual marketing budget paying cash and shares for content supporting the wishful thinking of the ReconAfrica management team, in alleged violation of US Securities laws – according to a whistleblower complaint filed with US authorities and outlined in a recent National Geographic story and supported by numerous reports by the financial research firm Viceroy.
There is not a single piece of independent research confirming anything that ReconAfrica claims, from their alleged “working petroleum basin” to any kind of large “source rock” that petroleum could flow from. On top of this the company has not allowed independent analysis of its well logs. Importantly, the target depth was not reached in either well. Petroleum exploration geologists like Matt Totten Jr. noted this issue in the WLC presentation, as this activity would be crucial in proving any kind of real discovery of oil and gas.

ReconAfrica drill site in the Kavango–Zambezi Transfrontier Conservation Area.
ReconAfrica drill site in the Kavango–Zambezi Transfrontier Conservation Area.

A very interesting fact is that there are over 40 other exploration licenses in Namibia. These other oil and gas exploration companies like Eco Oil & Gas Ltd., Chariot Limited, Letho Resources, Monitor Exploration Ltd and the local company Hydrocarb are valued at a fraction of what ReconAfrica is valued at. Their combined valuations are far below 10% of the current valuation of Reconafrica.
So why did ReconAfrica’s share price rise to such incomprehensible levels when there is still no third party validation of their incredible oil claims?
Our research shows that the company has been paying for sophisticated 3rd party online advertising which is published as factual reporting and not openly contested, so retail investors assume that this fabricated story of undiscovered oil riches must be true. We need our financial market regulators to do their job and step in to protect these retail investors. From our talks with long-term friends at Deutsche Boerse, we learned that the Canadian regulator is apparently not equipped to comprehend the internet advertising activities of Reconafrica. Given our background, we felt compelled to help them.
As internet financial investment experts, our research shows that digital marketing companies like NXT, Invesbrain and baystreet.ca are being paid to put ReconAfrica’s lies out on the internet in a systematic and strategic manner. Apparently, when a 3rd party is putting out false claims, the company believes it is investor relations, but in fact the company may be breaking the law. These manipulative practices remind me of techniques used by Cambridge Analytica who used something similar to pump up online support for Trump in 2016.
Our work shows that the company paid millions of dollars to acquire an estimated 5,000 retail investors through paid research from their dealer/broker Haywood Securities, oilprice.com and over 30 other ‘helpers’ across the internet. Our analysis of YouTube alone shows numerous stock promoters pumping ReconAfrica stock, like San Diego Torrey Hills Capital, TPG Investing, Zac Hartley, Brandon10x and many more.
NXT openly states that they help companies with investor relations but despite BankTrack publishing a scathing indictment of ReconAfrica’s potentially illegal investor relations activities, regulators have been mostly silent. We believe that German financial regulator BAFIN should look a lot more closely into companies listed on their exchanges like ReconAfrica to protect the retail investor. Finally there is some evidence that they are starting to do so.
By analyzing the many retail investor message boards, as well as through financial groups like Seeking Alpha, our team has uncovered that ReconAfrica is – not surprisingly – 99.97% owned by retail investors and insiders. It is important to note that in my 24 years as an investment banker, I have never seen a company valued at $1 billion with a shareholding based on such a high number of retail investors.

List of the most active users discussing ReconAfricas’ stock on Reddit and Stockwits. Findings suggest that these accounts were opened recently and maintained for the sole reason of pumping the stock.
List of the most active users discussing ReconAfricas’ stock on Reddit and Stockwits. Findings suggest that these accounts were opened recently and maintained for the sole reason of pumping the stock.

It is obvious to our team that the online messaging boards discussing ReconAfrica are managed by the company itself. The most active users on Reddit, Stocktwits, Yahoo Finance!, Discord and others have been set up in the last 9 months and mostly discuss only ReconAfrica stock. These accounts were clearly opened and maintained for the sole reason of pumping the stock. On regular stock chat lines there are always some dissenting voices, mentioning concerns or having open discussions. On ReconAfrica’s discussion boards all critics are removed from the platforms by very aggressive moderators. I was removed from the Discord board after questioning why some of ReconAfrica’s board members sold their shares ahead of the alleged “big oil announcement”, in late July 2021. The announcement was a flop, prompting many investors to sell their shares.
We have identified numerous issues with these promotional online chats which appear to have been purpose-built to hype the stock and silence dissent, including no announcement of the intent to run these boards by the company and most importantly for regulators, no public disclosure of money paid to certain people who run the boards and continually post promotional material on behalf of ReconAfrica.
I am not an oil expert by far, but when I researched the history of oil drilling in Namibia, I found evidence of similar unsuccessful oil speculations back to 1927. Since then there have been over 50 efforts of many global oil businesses to find oil in Namibia. All of them were unsuccessful. What have they missed that ReconAfrica has supposedly found?
Members of the ReconAfrica team, like director Jay Park, have been slated by the UN Security council for bribing officials in other African countries for what appeared to be lucrative oil contracts but left retail investors holding the bag.

Elephants in the Okavango Delta.
Elephants in the Okavango Delta.

We are living through a pivotal moment, when humanity is being asked to create a new financial paradigm in order to survive a world heating up from the overuse of fossil fuels. Namibia has vast amounts of wind and sunshine, two of the most powerful clean energies of the future. As financial advisors we cannot stand by and watch a company endanger the sustainable livelihoods of millions, while driving us further towards the brink of societal collapse. It is clear we need stronger institutions and regulations, but in the meantime we stand in solidarity with groups like the WLC to draw a line in the African sand, because we simply don’t have time to waste by continuing to follow the human race’s unsustainable demand for fossil fuels and that industry’s massive contribution to climate change.
How can you help this cause? Join our call for action!
If you plan to visit the Okavango Delta or would like to stay up to date with the newest developments in this story, please click here to find out about the Okavango Defence Coalition. We are actively working on economic alternatives for the region. Please visit our website where you can discover more details about how you can help as we publish them.
We have to stand firm, together, in order to take care of nature and the people fighting tirelessly for the survival of our planet, so please do consider supporting organizations like the Women’s Leadership Centre.

Written by MARCO RODZYNEK, We Don’t Have Time Board Member and lead investor, NOAH Conference founder, and financial advisor to over 300 internet start-ups in the last 24 years.

  • Erastus Shalikika

    113 w

    Thanks for the article but I don't trust that

    • Ingmar Rentzhog

      113 w

      Trust what?

      • Marco Rodzynek

        113 w

        As long as you don’t trust Reconafrica

      • Andreas NAANGO

        113 w

        This is shocking if it's true, scam in the highest level

        1
        • Elisabeth Kosters

          144 w

          Hi, I wrote about the geology of this area on my blog: www.earthsciencesociety.com. It’s the most recent post.

          4
          • Sarah Chabane

            144 w

            Thank you for sharing!

            2
          • David Peller

            146 w

            No problem. The Head Geologist / CEO / Technical advisors did not sell. Those are the only persons that matter. And I'm supportive of your environmental agenda. I just don't think it's realistic that humans will be able to give up fossil fuels so quickly. I think we need to. We should all travel less, drive non-ICE cars etc. In the meantime I'd rather see light oil production done safely in Namibia versus shale production in the USA etc.

            • Marco Rodzynek

              145 w

              Has there been any oil production in Namibia David?

              2
            • David Peller

              146 w

              Marco. Ever think that someone posting on Reddit about RECO (and other stocks they own) is just a small investor. I made your list of "pumpers". I take offense to the idea that I am a paid pumper. Using the same logic, you must be short the stock or on the payroll of the criminal short - Fraser "failed social worker" Perring. Maybe you should think more before writing such drivel.

              • Marco Rodzynek

                146 w

                I am glad you read it and I feel sorry to have hurt your feelings.

                3
                • Marco Rodzynek

                  146 w

                  And I have not shorted the stock. Just to set this record straight. Of course there are some real investors here hoping for oil. $6m marketing budget moved a lot as we all know. Have you seen that the company secretary and CFO sold significant parts of their holdings pre end of July. I heard there was a big oil announcement expected, so why does management sell? There are so many issues here that I am the least of your concern

                  4
                • Kate Treharne

                  146 w

                  Exploration and drilling should never have been allowed in this exceptional habitat. Capitalism is eating the planet. Wellbeing economy is the alternative we need. 💚🌍💚⌛💚

                  5
                  • Josaphat Finogbé

                    146 w

                    Well done Marco With all this, we must act, right now We don't have really Time Let's act

                    5
                    • evan h

                      146 w

                      Well done Marco this is an exceptional effort

                      4
                      • bud bud

                        146 w

                        You sir, are a liar. Are the short selling hedge funds paying for this article? Recon Africa is being very careful to follow all environmental regulations and involve the local community. They have the fullest support of the Namibian government. Namibia is one of the poorest places on Earth. Why should they not have the ability to use their natural resources as western nations have to become wealthy for the past 150 years?

                        1
                        • Marco Rodzynek

                          146 w

                          Making the false claim that I took money for the work is similar to the false claim that there is oil in Namibia. Every professional oil company would proof the existence of oil before the drilling. Sorry, but the facts are too clear here and there is no confusion caused

                          7
                          • Marco Rodzynek

                            146 w

                            So bud bud, lets go to the wells and show me the oil, then we see who of us two is the liar. I would bet my bud on this. You have to prove us the existence of oil, and not the other way around ;)

                            6
                            • Marco Rodzynek

                              146 w

                              Besides, even if there would be oil, do you know how much money stays in Namibia? Have you looked at the oil spills in the Niger Delta? We are doing a movie on this. Whoever you are, you can call me any time and I walk you through the details. I care about Namibia as much as you do and have done the hard work here to peel the onion. what I found is has nothing to do with natural resources but with digital marketing. Your Government is being lied to.

                              6
                            • Stephen Kariuki

                              146 w

                              Oh sad for our mother Africa

                              3
                              • Patrick Kiash

                                146 w

                                Thankyou for this article,it's very insightful! But individually am very worried lots of stakeholders are not aware of the bomb ready to explode! I feel for our continent as same as our planet! Credible actions is highly needed!

                                5
                                • Sarah Chabane

                                  146 w

                                  Enraging and so typical of western companies implanting themselves in politically/economically unstable countries and taking advantage of this context to do whatever they want.

                                  7
                                  • Douglas Marett

                                    146 w

                                    Thank you for the insightful article!

                                    6
                                    • Ntshetshere David Letsoalo

                                      146 w

                                      I am Ntshetshere David Letsoalo from Limpopo Province South Africa, I would love to be on a collision course with machine emmision and design a device which would consume greenhouse gases from exhaust systems.

                                      3
                                      • Johan Moore

                                        146 w

                                        Oil is corrupt. Nothing new! They have always been and will always be. Good article! They will hate this. Probably going to try to stop you! Keep it up and stay strong!

                                        8
                                        • Ingmar Rentzhog

                                          146 w

                                          Thank you so much for your well-researched and well-written article Marco! This is clearly an investment scam. That makes the environmental damage that it creates even worse. Oil is a very dirty business.

                                          12
                                          • Adam Wallin

                                            146 w

                                            From what I've seen from ReconAfrica, including their response to warnings on this platform, the never back up anything they say or do with credible sources. So this makes a lot of sense to me, that they really don't have anything to back it up with. How can we make this practice stop and make it unprofitable for others to do?

                                            14
                                            • Tomas Roovete

                                              146 w

                                              Marco, Thank you for a very interesting article and we also see the emergency on the car´s windscreen, there are no more insects. Insects are a very important and crucial part of our planet´s ecosystem and now I heard that wind power could be a big culprit in this (I haven´t had it confirmed). However, the conclusion is that we must act now against drilling for oil and hopefully make new decisons in the right direction to solve the climate crisis.

                                              7
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