Africa Oil Announces Farmouts in the Rift Basin Area and Adigala Blocks in
NEWS RELEASE TRANSMITTED BY Marketwired
FOR: Africa Oil Corp.
TSX VENTURE SYMBOL: AOI
OMX SYMBOL: AOI
MARCH 4, 2014
Africa Oil Announces Farmouts in the Rift Basin Area and Adigala Blocks in
VANCOUVER, BRITISH COLUMBIA--(Marketwired - March 4, 2014) - Africa Oil Corp.
(TSX VENTURE:AOI)(OMX:AOI) ("Africa Oil" or the "Company")
is pleased to announce that it has received Ethiopian government approval in
respect of two farmout agreements:
1. Marathon Oil Corporation (NYSE:MRO) ("Marathon Oil"), through its
wholly-owned subsidiary Marathon Ethiopia Limited B.V., will acquire a
50% interest in the Rift Basin Area;
2. New Age Ethiopia Limited ("New Age") will acquire a 40% interest in the
Under the terms of the Marathon Oil farmout agreement, Marathon Oil will
acquire a 50% interest in the Rift Basin Area in Ethiopia. Africa Oil will
maintain operatorship of the block, but Marathon Oil has the right to assume
operatorship if a commercial discovery is made. In consideration for the
assignment of this interest, Marathon Oil will pay Africa Oil an entry payment
of $3 million in respect of past costs, and has agreed to fund $15 million of
Africa Oil's working interest share of joint venture expenditures in the
Rift Basin Area. Africa Oil and Marathon Oil are pleased to complete the final
tranche of the farmout transaction originally announced in July 2012 (press
release dated July 23, 2012). Completion of this transaction is anticipated in
March 2014. Following completion, Africa Oil and Marathon Oil will each hold a
50% working interest in the Rift Basin Area.
The Rift Basin Area covers 42,519 square kilometres and is on trend and
extending to the northeast of the highly prospective blocks in the Tertiary
rift valley including the South Omo Block, and Kenyan Blocks 10BA, 10BB, 13T,
and 12A. A 1,200 kilometre 2D seismic survey is anticipated to be acquired
during the second half of 2014.
Under the terms of the New Age farmout agreement, New Age will acquire an
additional 40% working interest in the Adigala Block, in Ethiopia. Following
completion, Africa Oil's interest will be reduced to 10%. In consideration
of the assignment New Age will carry Africa Oil's working interest share
of a planned 1,000 kilometre 2D seismic work program in the Adigala Block.
Completion of this transaction is anticipated in March 2014.
Keith Hill, Africa Oil's President and CEO, stated, "We are very
pleased to receive government approval to complete these farmout transactions
as we continue to actively manage our highly prospective East African acreage
portfolio. We look forward to continuing to work with Marathon Oil as a partner
given their stature and long history of success in the oil and gas business. 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 at least 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 by the end of 2015 or early 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".
Forward Looking Statements
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.
FOR FURTHER INFORMATION PLEASE CONTACT:
Africa Oil Corp.
INDUSTRY: Energy and Utilities - Oil and Gas
-0- Mar/04/2014 07:00 GMT
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