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Octant Energy excited about drilling in world class basins as it completes Kenya acquisitions

Friday, April 21, 2017 0:25
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Octant Energy Corp has completed its pivotal acquisition of Kenyan assets from the former Afren Plc, paving the way for exploration drilling to start soon in world class basins.

It was in 2015 the group agreed the deal to acquire the effectively “drill ready” assets from subsidiaries via administrators and now Octant has its hands on Block L17/L18 and Block 1 in Kenya.

Octant is run by former Black Marlin boss Richard Schmitt, who is already familiar with the assets as they were part of the business he sold to Afren back in 2010.

He said today: “I am extremely happy to be returning to these assets…

“In the period since Afren acquired these assets from Black Marlin, the environment in Kenya has been transformed by the first commercial oil discoveries. Moreover, information from neighbouring operators has provided only encouragement.

“We look forward to the potential of exploration drilling in Kenya’s world class basins and to follow the exploration success other companies have had there.”

At Block L17/L18, which is 100% owned, Octant aims to sink a well as soon as possible.

The block lies both onshore and offshore in the Lamu coastal basin in south-eastern Kenya, covering an area of around 4,905 sq km.

It has already seen substantial investment with around 5123 km’s of 2D seismic, and 1626 sq km’s of 3D seismic having been acquired, along with 2500 km’s of gravity and magnetics.

Significantly, Kenya’s largest port, and the idled Kenya petroleum refinery, lie within this block at Mombasa, providing options for export.

Moreover, there was the highly significant Sunbird-1 oil discovery, made by British Gas (now Royal Dutch Shell (LON:RDSB)  in 2014, just a short distance away.

The second asset – Block 1 -  lies on the  western margin of the Mandera-Lugh basin and consists of an area of 22,250 sq km with 1900kms of 2D seismic already completed.

Octant will operate this block with an 80% working interest and will restart exploration with a small 2D seismic survey before moving to drill the first exploration well.

Octant has also entered into a purchase and sale agreement with Afren for its 74% operating interest in the Tanga Block in Tanzania.

Closing of this sale is in train and an updated timeline for completion is expected shortly, the group said.

As reported in March, Octant arranged a US$10mln financing and entered into a term sheet with Rosseau Asset Management (RAM) to complete the acquisitions.

Afren paid US$101mln for Black Marlin in 2010, which  goes some way to show the significant value of these African assets, and the discount Octant is getting.  

Story by ProactiveInvestors


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