Petroleum Africa
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Wednesday, May 27, 2009
Black Marlin Energy Ltd.’s subsidiary East Africa Exploration Ltd. (EAX) and Africa Oil Corp. (AOC) have completed a farm-in agreement. Under the agreement EAX will farm into AOC’s assets in Ethiopia and Kenya. EAX will gain a 30% stake in AOC’s Blocks 2/6 and 7/8 PSCs in the highly under-explored Ogaden Basin of southern Ethiopia. AOC will also transfer a 20% license interest to EAX in the prospective Block 10A PSC, located in the Anza Basin of northern Kenya.
This farm-in transaction is subject to approvals of the appropriate regulatory authorities from the Government of the Federal Democratic Republic of Ethiopia and Republic of Kenya in addition to waiver of pre-emptive rights by an existing partner in the Ethiopian licenses.
AOC gained access to the Ethiopian and Kenyan assets when a deal with Lundin Petroleum was finalized earlier this year. AOC, in the Lundin deal gained access to Lundin’s interests in and operatorship of PSCs covering Blocks 2, 6, 7, and 8 in the Ogaden Basin region in southern Ethiopia and the Adigala Area in northern Ethiopia. In Kenya, AOC gained Lundin’s operated interest in the Block 10A PSC and its non-operated interest in the Block 9 PSC in the Anza Basin. The sale also included the transfer of an option which Lundin Petroleum holds over Blocks 35 and M10-A in
AOC has executed a seismic contract with Black Marlin’s Upstream Petroleum Services Limited (UPSL) to undertake the seismic and acquisition using UPSL Sercel 428 equipped seismic crew and new 65,000 lb vibrators to carry out a total of 1,250 km of 2D seismic data acquisition as part of the farm-in agreement. In each case EAX will pay for a disproportionate amount of the seismic costs until an agreed cap is reached, as well as paying AOC for a proportion of its back and future operational costs.
Under a separate deal AOC has contracted UPSL to acquire 500 km of seismic data for AOC and its partner New Age Ltd. on their Adigala Block in north central Ethiopia in a transaction in which EAX is not involved.
Jeff Hume, CEO of Black Marlin Energy, commented, “I am very pleased to be able to announce this strategic and exciting transaction and look forward to working very closely with our new partners, Africa Oil and New Age. All of the partners bring strong technical experience to the Joint Venture and we are very gratified that Black Marlin’s business model of offering high quality seismic services as part of a farm-in package, has again been vindicated. Ethiopia is a new venture for both EAX and UPSL and we are very excited about the prospects. Having converted the UPSL 428 seismic crew to vibrator operations we now have a 12-15 month backlog of around 3,000 km of 2D seismic data for the crew to acquire in Ethiopia and Kenya, between our farm-in commitment with Africa Oil and our own work in Block 1 in Kenya.”
Black Marlin Energy Limited and its subsidiaries EAX and UPSL are privately held exploration and exploration services companies based in Dubai. EAX has holdings in PSC’s in Madagascar, The Seychelles, Kenya, Ethiopia and Tanzania where EAX has a 10% stake in the Kiliwani North Gas Discovery. EAX operates both in an offshore 15,000 sq km concession area in the Seychelles with a 75% interest and in Block 1 in Kenya with a 50% interest. UPSL operates land, vibrator and dynamite seismic crews and offers specialized marine and transition zone seismic and geochemical services.
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