Africa Oil says resource estimates rises in Kenya

Xinhua
Saturday, August 25, 2012

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Canadian oil and gas firm Africa Oil announced on Wednesday significant increase in independent assessment of the company’s prospective resource potential in Kenya and Ethiopia’s exploration properties.

According to an assessment carried out by Gaffney, Cline & Associates, Africa Oil’s holdings include working interests in operated and non-operated Production Sharing Contracts (PSC’s) in Kenya, Ethiopia and Puntland (Somalia) in East Africa.

These Blocks, said the company said in a statement, contain relatively under explored plays in basins that have proven and productive analogs.

Africa Oil’s CEO Keith Hill said they were pleased that the investment to date in their aggressive exploration program has yielded these results showing a considerable increase in the prospective resources assigned to a growing number of leads and prospects.

“Gaffney Cline’s independent assessment confirms the enormous resource potential of our enviable East Africa onshore acreage,” Hill said in a statement issued in Nairobi.

While decades of oil exploration failed to yield results, in most cases, ending with nothing less than a bottle of crude oil, an oil expert said there were high hopes of Kenya striking oil with the advent of new oil exploration technologies.

Engineers working for an Irish oil exploration firm Tullow Oil have announced that quantities of oil were discovered in Turkana, northern Kenya.

The rock on which the oil was discovered is over 20 meters deep and is believed to bear larger oil quantities than those discovered by Tullow in Uganda three years ago.

According to Hill, in addition the Ngamia-1 oil discovery has resulted in a considerable increase in the geological chance of success assigned to numerous prospects and leads, most notably in the Lokichar sub-basin.

“We continue to aggressively explore with three seismic crews active and a continuous drilling program that is expected to have three rigs under contract by the end of 2012. We expect the next 18 months to be transformational for the Company as we will continuously drill high impact exploration targets,” he said.

Hill said the latest estimates do not include the company’s Puntland (Somalia) oil and gas interests which is under Horn Petroleum Corporation, Africa Oil’s 45 percent owned subsidiary.

Kenya and the entire East African region, has witnessed intensified exploratory activity since 2003, which led to the discoveries of oil and gas in Uganda and Tanzania. There is also ongoing exploration in Ethiopia.

The East African nation has also tendered for the exploration of natural gas in Kilifi, near the coastal city of Mombasa. Analysts said one of the contributors for slow exploration of minerals in Kenya has been lack of mapping of the resources.

Experts say countries in East Africa and on the seaboard from Ethiopia on down to Mozambique have all begun to benefit from the success of Uganda as it made it easier fro smaller companies to raise funding for exploration in the region.

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