Africa Oil Provides Operations Update
VANCOUVER, BRITISH COLUMBIA -- (Marketwired) -- 02/12/14 -- Africa
Oil Corp. (TSX VENTURE: AOI)(NASDAQ: AOI)(OMX: AOI) ("Africa Oil" or
the "Company") is pleased to provide the following update on its
activities in Kenya and Ethiopia. Africa Oil's work program for 2014
will include at least 20 exploration and appraisal wells, extended
well tests on the South Lokichar basin discoveries, and will include
exploration wells targeting four new basins.
Excellent progress continues with the exploration and appraisal
program in the South Lokichar basin in Northern Kenya which is the
site of seven consecutive significant oil discoveries by Africa Oil
in conjunction with its 50% partner and Operator, Tullow Oil plc
("Tullow"). Currently three drilling rigs and a test rig are
operating in the South Lokichar basin.
Well testing at Etuko-1 from five identified Lokhone pay intervals
confirmed the previously announced discovery. Light 36 degree API
waxy crude oil was successfully flowed from three zones at a combined
average rate of over 550 barrels of oil equivalent per day.
Additional potential pay zones with good oil shows were identified in
good quality Auwerwer sandstones over a 200 metre interval shallow in
the Etuko-1 well but were not able to be evaluated due to a large
hole size. The rig was skidded over and will now drill a 650 metre
well to evaluate and potentially test this upper reservoir section.
The rig that recently completed drilling the Amosing discovery has
mobilized to the Emong prospect and spud the well on 5 February 2014.
Emong-1 is located 6 kilometres to the west of Ngamia-1 and is
targeting high quality Auwerwer sandstones. The prospect is fault
offset and updip from the large Ngamia oil discovery which has over
200 metres of net oil pay. The gross best estimate of prospective
resources for Emong are 242 million barrels of oil based on a
third-party independent resource assessment. The well has a planned
total depth of 1,500 metres and is expected to take 40 days to drill.
The rig that recently completed drilling the Ewoi discovery has
mobilized to drill the first of three planned back-to-back appraisal
wells at the large Twiga South oil discovery. Twiga South-2 which
will spud mid-February 2014, is located 2 kilometres to the west of
the Twiga South-1 discovery well and is updip on the structure. The
well is designed to assess the areal extent of the high quality
Auwerwer net pay encountered in the discovery well and also the
prospective resources associated with up to 150 metres of shallower
water bearing high quality Auwerwer net sands encountered at Twiga
South-1 that are within mapped closure at this location. The Twiga
South gross best estimate of unrisked prospective resources for the
discovery are 132 million barrels of oil based on a third-party
independent resource assessment. The well has a planned total depth
of 2,000 metres and is expected to take 45 days to drill. An extended
well test of the Twiga South field is being planned for towards the
end of the year.
A light well testing and completions rig has been mobilized and has
commenced testing operations on the Ekales oil discovery. Testing
operations on Ekales-1 are expected to be complete by end March 2014.
A large 3D seismic survey over the western flank of the South
Lokichar basin has commenced and civils construction on several
exploration and appraisal locations is being progressed to keep pace
with the aggressive drilling program.
Given the significant contingent resources associated with
discoveries to date and the extensive exploration, appraisal and
seismic program planned to fully assess the upside of the South
Lokichar basin, the Company and its partner and Operator, Tullow, has
agreed with the Government of Kenya to commence development studies.
In addition, the partnership is involved in a comprehensive pre-FEED
study for an export pipeline. The current ambition of the Government
of Kenya and the joint venture partnership is to reach project
sanction for development, including an export pipeline, in the period
2015/2016. If further exploration success opens additional basins
there will be scope for the development to be expanded.
The Sala-1 well in Kenya Block 9 will spud mid-February 2014 and
Africa Oil will operate this well on behalf of its 50% joint venture
partner Marathon Oil Corporation. The prospect is a large three way
dip closed structure against the rift bounding fault in the
Cretaceous Anza rift in a similar structural setting to the Tertiary
Ngamia discovery in Block 10BB. Sala is updip from the Bogal-1 well
drilled in 2010 which appeared to find a significant gas accumulation
and also near the Ndovu-1 well drilled in 1988 which had significant
shows of oil and gas. The unrisked prospective resources for Sala are
approximately 400 million barrels of recoverable oil based on a
third-party independent resource assessment. The well has a planned
total depth of 3,450 metres and is expected to complete by end April
2014. Additionally, preparations are being made for drilling in the
South Kerio and West Turkana basins later in the year exposing the
Company to multiple potential basin opening wells in Kenya.
In the South Omo Block in Ethiopia the rig is currently moving to the
previously undrilled Chew Bahir basin, to drill the Shimela prospect
in the eastern portion of the block where new seismic has delineated
a number of exciting new prospects, some of which have encouraging
seismic amplitude anomalies that map with closure. The well is
expected to spud at the end of the first quarter of 2014 with the aim
of derisking some further 15 prospects and leads across the basin.
The Company has a 30% interest in the block which is operated by
Tullow with a 50% interest and Marathon Oil holding the remaining 20%
In Block 8 in Ethiopia, drilling continues on the El Kuran-3 well
with the current depth being 2,850 metres. The well encountered a
1,200 metre section of Jurassic Hamanlei carbonates, with wet gas and
oil shows throughout the interval, similar to the El Kuran-1 well
drilled in 1972. The reservoirs are low porosity and permeability and
will require acid or fracture stimulation to produce at commercial
levels. A decision was taken to deepen the well to the below the
planned target depth to evaluate the deeper Gumboro zone which has
significant gas condensate potential. The revised total depth of the
well is 3,500 metres and is expected to be complete in April. The
Company has a 30% interest in the block which is operated by NewAge.
Keith Hill, President and CEO of Africa Oil commented, "We have a
very exciting exploration and appraisal program set out for 2014
which will see us complete over 20 wells. Currently we have seven
rigs running and after releasing one in mid-year will have six rigs
running full time through the remainder of the year. Our program has
three objectives, to appraise the existing key discoveries, to drill
out the remaining prospects in the South Lokichar basin and to open
at least one of the four new basins being tested along trend.
Additionally, we are pushing hard to move the development studies
along with the aim of sanctioning a pipeline development for the
South Lokichar basin in the period 2015/2016. This fully funded
program should continue to deliver high potential upside value for
shareholders through this year and beyond."
About Africa Oil
Africa Oil Corp. is a Canadian oil and gas company with assets in
Kenya and Ethiopia as well as Puntland (Somalia) through its 45%
equity interest in Horn Petroleum Corporation. Africa Oil's East
African holdings are within a world-class exploration play fairway
with a total gross land package in this prolific region in excess of
230,000 square kilometers. The East African Rift Basin system is one
of the last of the great rift basins to be explored. Seven new
significant discoveries have been announced in the Northern Kenyan
basin in which the Company holds a 50% interest along with operator
Tullow Oil plc. The Company is listed on the TSX Venture Exchange and
on First North at NASDAQ OMX-Stockholm under the symbol "AOI".
Cautionary Statements regarding Well Test Results and Prospective
The well test results reported in this press release are not
necessarily indicative of long-term performance or of ultimate
This press release contains estimates of the gross best estimate of
prospective oil resources associated with several drilling prospects.
Please refer to the Company's press release dated September 3, 2013
for details of the Company's prospective resources by prospect and
lead, including the geologic chance of success, based on an
independent assessment of the Company's prospective and contingent
resources in Kenya and Ethiopia, effective July 31, 2013. There is no
certainty that any portion of the resources will be discovered. If
discovered, there is no certainty that it will be commercially viable
to produce any portion of the resources.
Drill stem tests are commonly based on flow periods of 1 to 3 days
and build up periods of 1 to 3 days. Transient pressure analysis is
Certain statements made and information contained herein constitute
"forward-looking information" (within the meaning of applicable
Canadian securities legislation). Such statements and information
(together, "forward looking statements") relate to future events or
the Company's future performance, business prospects or
opportunities. Forward-looking statements include, but are not
limited to, statements with respect to estimates of reserves and or
resources, future production levels, future capital expenditures and
their allocation to exploration and development activities, future
drilling and other exploration and development activities, ultimate
recovery of reserves or resources and dates by which certain areas
will be explored, developed or reach expected operating capacity,
that are based on forecasts of future results, estimates of amounts
not yet determinable and assumptions of management.
All statements other than statements of historical fact may be
forward-looking statements. Statements concerning proven and probable
reserves and resource estimates may also be deemed to constitute
forward-looking statements and reflect conclusions that are based on
certain assumptions that the reserves and resources can be
economically exploited. Any statements that express or involve
discussions with respect to predictions, expectations, beliefs,
plans, projections, objectives, assumptions or future events or
performance (often, but not always, using words or phrases such as
"seek", "anticipate", "plan", "continue", "estimate", "expect, "may",
"will", "project", "predict", "potential", "targeting", "intend",
"could", "might", "should", "believe" and similar expressions) are
not statements of historical fact and may be "forward-looking
statements". Forward-looking statements involve known and unknown
risks, uncertainties and other factors that may cause actual results
or events to differ materially from those anticipated in such
forward-looking statements. The Company believes that the
expectations reflected in those forward-looking statements are
reasonable, but no assurance can be given that these expectations
will prove to be correct and such forward-looking statements should
not be unduly relied upon. The Company does not intend, and does not
assume any obligation, to update these forward-looking statements,
except as required by applicable laws. These forward-looking
statements involve risks and uncertainties relating to, among other
things, changes in oil prices, results of exploration and development
activities, uninsured risks, regulatory changes, defects in title,
availability of materials and equipment, timeliness of government or
other regulatory approvals, actual performance of facilities,
availability of financing on reasonable terms, availability of third
party service providers, equipment and processes relative to
specifications and expectations and unanticipated environmental
impacts on operations. Actual results may differ materially from
those expressed or implied by such forward-looking statements.
ON BEHALF OF THE BOARD
Keith C. Hill, President and CEO
Africa Oil's Certified Advisor on NASDAQ OMX First North Stockholm is
Pareto Securities AB.
Neither the TSX Venture Exchange nor its Regulation Services Provider
(as that term is defined in the policies of the TSX Venture Exchange)
accepts responsibility for the adequacy or accuracy of this release.
Africa Oil Corp.
(604) 689-4250 (FAX)
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