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Wednesday, 15 January 2014

Tullow & Africa Oil Announce Two Additional Oil Discoveries in Kenya

Jan. 15, 2014) ("Africa Oil" or the "Company") is pleased to announce that the Amosing-1 and Ewoi-1 exploration wells in Block 10BB, onshore Northern Kenya, have resulted in the discovery of two new large oil fields. These two wells continue the 100% success rate in the South Lokichar Basin with seven out of seven discoveries to date.

Based on results of drilling, wireline logs and samples of reservoir fluid, the Amosing-1 well has intersected potential net oil pay of 160 to 200 metres, significantly exceeding pre-drill expectations. Amosing is located 7 kilometres southwest of the previously announced Ngamia discovery along the western basin bounding fault trend commonly referred to as the "string of pearls".

On the eastern side of the basin known as the rift flank play, the Ewoi-1 well has encountered potential net pay of 20 to 80 metres and has continued to de-risk the basin flank play opened up by the Etuko-1 well in 2013 located 4 kilometres to the east.
Following completion of logging operations, the wells will be suspended for future flow testing which will confirm the net pay counts. These two rigs will mobilize to drill the Emong-1 prospect (formerly called Ngamia West), and the Twiga South-2 appraisal well, both located in Block 13T.

Africa Oil has a 50% interest in both discoveries with operator Tullow Oil plc holding the remaining 50% interest.

The Etuko-1 well testing in Block 10BB is underway and is scheduled to be completed later this month and the Ekales-1 well test should commence shortly. Drilling continues on the El Kuran discovery in the Somali region of Ethiopia and is expected to reach the new revised total depth of 3,500 metres by the end of the first quarter. New basin opening wells at Sala-1 in Block 9 in Kenya and the Shimela-1 well in the Chew Bahir Basin in South Omo Block in Ethiopia are expected to spud in February and April, respectively. The partnership has elected not to continue into the next exploration phase in Block 10A in Kenya and the previously planned test of the Paipai well has been cancelled due to concerns over economic viability.

Keith Hill, President and CEO of Africa Oil commented, "The continued success of our exploration program in northern Kenya will allow us to drive development plans forward with greater certainty. Given that we have now had a 100% success rate on exploration prospects in the basin, we expect to see more growth in resources and more discoveries as our aggressive drilling program unfolds in 2014. In addition, the several new analogous basin opening wells being drilled during this program also have the potential to bring a step change in company valuation upon success."