VANCOUVER, BRITISH COLUMBIA–(Marketwired – Jul 3, 2013) –
Africa Oil Corp. (TSX
VENTURE:AOI)(OMX:AOI)(“Africa Oil” or the “Company”) is
pleased to announce excellent results from its recent drilling
operations in Kenya and Ethiopia.
The testing program at the Ngamia-1 oil discovery on Block 10BB
in Kenya has now been successfully completed. The cumulative flow
rate from six Drill Stem Tests (“DST’s”) was over 3200 barrels of
oil per day (“BOPD”) constrained by completion techniques and
surface equipment. With optimized completion techniques and surface
equipment it is estimated that these combined flow rates would
increase to a rate of 5400 BOPD. Five of the DSTs were completed
over the Auwerwer sandstones to verify reservoir quality and fluid
content which appear to be of similar quality to those tested at
the Twiga South-1 well in the same basin. High quality waxy sweet
crude (25-35 degrees API) was flowed from all five zones in the
Auwerwer formation with good quality reservoir sands encountered.
All zones produced dry oil with no water produced and no pressure
depletion. One DST was completed on the Lower Lokhone with
successful results as previously announced on April 15, 2013.
In addition to proving the good quality reservoir, as a result
of testing several previously indeterminate zones in the well, the
joint venture has been able to double the firm net oil pay estimate
in the Ngamia well to over 200 meters over a gross oil column of
over 1,100 meters and has increased the net pay at Twiga to over 75
meters. The Operator, Tullow Oil, has reported that they believe
the Ngamia and Twiga fields contain over 250 million barrels of
recoverable oil. Appraisal work, including the acquisition of 3D
seismic and the drilling of appraisal wells on both discoveries,
will be undertaken over the next year to confirm these estimates. A
mid-year revision to the Company’s third party resource report is
ongoing and is expected to be issued in the third quarter and will
take into account these improved reservoir thickness and quality
parameters.
The Weatherford 804 rig used to test this well is currently
being mobilized 13 kilometers north to the Ekales location, a
prospect similar to and located between the Twiga and Ngamia
discoveries, which is expected to spud in late July.
The Company is also pleased to announce that oil has been
discovered in the Etuko prospect in the Lokichar Basin in Block
10BB in Kenya. This well was located on a tilted fault block target
on the Basin Flank Play on eastern side of the basin. Based on logs
and oil recovered by MDT sampling, net pay of 40 meters has been
confirmed in the Auwerwer and Upper Lokhone targets which
demonstrate good reservoir properties and oil quality. Within the
Upper Lokhone sequence the well encountered a thick section of
lacustrine source rocks with interbedded oil-bearing sandstones.
The well is currently drilling in the Lower Lokhone sands and
results from this lower section are expected by the end of
July.
The Company is also pleased to announce that the Sabisa-1 well,
the most northerly well drilled in the trend to date, has confirmed
a viable hydrocarbon system in this region. The well was drilled on
the South Omo Block in Ethiopia in the northern portion of the
Turkana Basin, over 300 kilometers north of the Ngamia and Twiga
discoveries, to a total depth of 2082 meters. The well encountered
reservoir quality sands, oil shows and heavy gas shows indicating
an oil prone source rock and a thick shale section which should
provide a good seals for the numerous fault bounded traps
identified in the basin. Only the lowermost sands appear to be in
trapping configuration at Sabisa. Based on the encouragement of the
results of this well however, the decision has been made to drill
the nearby Tultule prospect which appears to be a horst-block
structure 4 kilometers to the east. The OGEC 75 rig move has been
initiated and a late third quarter spud is expected. Numerous
additional follow-up prospects have been mapped in this part of the
South Omo Block and in the adjacent Chew Bahir Basin.
Preparations continue for drilling in both the Kenya Block 9
Bahasi prospect and the Ethiopia Ogaden Basin Block 8 El Kuran
prospect. Africa Oil will operate the Bahasi well on behalf of its
50% joint venture partner Marathon Oil and will utilize the Great
Wall drilling rig #190. The prospect is a large anticlinal feature
in the Lower Cretaceous Anza rift and is on trend with the Paipai
discovery made early this year in Kenya Block 10A. The El Kuran
well is being operated by New African Global Energy and is expected
to spud in July. It is a Jurassic fractured carbonate play on a
large anticlinal feature that had previously been drilled by
Tenneco in the early 1970′s and had tested light oil at low rates.
The primary goal of this well is to prove commercial flow rates.
Based on the results of the initial well, fracture stimulation and
horizontal drilling may be considered. An additional lightweight
rig for testing and drilling operations is also being mobilized
into the Lokichar Basin in Kenya which will bring the total rig
count to six in the Company’s blocks in Kenya and Ethiopia. A Full
Tensor Gradiometry (“FTG”) survey is also currently underway in the
Company’s wholly owned Rift Basin Area in Ethiopia and is expected
to be completed in August.
Africa Oil CEO Keith Hill commented, “We are very pleased with
the results of the Ngamia-1 testing program which has confirmed the
productivity of both the Lower Lokhone reservoir and the high
quality Auwerwer reservoir and significantly increased the net pay
in the well. Ngamia is a world-class oil discovery and these
results move us towards achieving the threshold for a commercial
development in the Lokichar basin. This encouragement has caused us
to set in motion appraisal of the Ngamia-Twiga trend and to
assemble a technical team to commence early development planning
both for a large scale pipeline development and an early
development scheme. The Etuko discovery also opens up a new fairway
on the eastern flank play in Lokichar where a number of other large
scale prospects have been identified. The Sabisa results are also
highly encouraging as all the major components for oil accumulation
appear to have been proven in one of our largest and most
prospective frontier basins in the portfolio. The second half of
2013 promises to be an exciting and transformational period in the
growth history of the Company.”
About Africa Oil Corp.
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 in within a world-class exploration play
fairway with a total gross land package in this prolific region in
excess of 250,000 square kilometers. The East African Rift Basin
system is one of the last of the great rift basins to be explored.
Two new significant discoveries have been announced in the Lokichar
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 is
Pareto Öhman 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.
Sophia Shane
Corporate Development
(604) 689-7842
(604) 689-4250
www.africaoil.com