Africa Energy, an oil and gas company with exploration assets offshore South Africa and Namibia, announces financial and operating results for the year ended December 31, 2019. 

Garrett Soden, the Company's President and CEO, commented: 
"Despite the current market volatility triggered by the coronavirus pandemic, 2019 was a transformational year for Africa Energy with the Brulpadda discovery on Block 11B/12B offshore South Africa. After the discovery, the Block 11B/12B joint venture partners initiated two phases of 3D seismic over the Paddavissie Fairway and an extended 2D seismic survey across the remainder of the block, the results of which are very encouraging. The multi-well 2020 exploration campaign is expected to kick-off with the Luiperd well in June and will target several de-risked submarine fan prospects with substantial prospective resources. As the global coronavirus situation is fluid, we will update investors if there are material changes to the drilling schedule. With the recent collapse in oil prices, we will continue to focus on cost control. However, we are well-positioned to weather the current environment given our lean overhead, our recent equity financing and the farmout of Block 2B."

HIGHLIGHTS

• In February 2019, the Block 11B/12B joint venture partners drilled the Brulpadda well with the Odfjell Deepsea Stavanger semi-submersible rig and discovered light oil and a total of 57 meters of net gas condensate pay over two Lower Cretaceous high-quality reservoirs. The Company holds an effective 4.9% participating interest in Block 11B/12B.
• In March and April 2019, Polarcus Limited acquired 570 square kilometers of 3D seismic on Block 11B/12B to cover the Brulpadda discovery and the Luiperd Prospect. The fully-processed Polarcus 3D dataset confirms the large resource potential of the Paddavissie Fairway.
• In July 2019, the operator of Block 11B/12B, Total SA, executed a multi-well drilling contract with Odfjell Drilling for the Deepsea Stavanger semi-submersible rig to return to South Africa and drill up to three exploration wells on Block 11B/12B. The rig is expected to mobilize from the North Sea to South Africa in April 2020 and spud the Luiperd well in June 2020.
• In December 2019, Shearwater GeoServices Holding AS ("Shearwater") commenced a 3,370 linear kilometer 2D seismic program on Block 11B/12B using the Multi-Purpose Vessel SW Cook. The scope of the survey was increased to focus on the new Kloofpadda lead to the east following encouraging seismic indicators identified with the onboard fast-track processing. The expanded survey totaling 7,589 linear kilometers was completed in March 2020.
• In December 2019, Petroleum Geo-Services ASA ("PGS") commenced a 2,200 square kilometer 3D seismic program on Block 11B/12B using the PGS Apollo seismic vessel. The scope of the survey was increased to cover a newly identified northern extension to the Luiperd Prospect. PGS has covered approximately 1,652 square kilometers to date, and the expanded survey is expected to be completed in the second quarter of 2020.
• Subsequent to year end, Africa Energy completed a private placement issuing an aggregate of 104,652,174 common shares at a price of SEK 2.30 (CAD 0.32) per share for gross proceeds of $25.0 million.
• Subsequent to year end, Africa Energy executed two farmout agreements whereby the Company will transfer operatorship and an aggregate 62.5% participating interest in Block 2B in consideration for $0.5 million in cash and a carry through the next exploration well. Africa Energy will retain a 27.5% participating interest in Block 2B.

OUTLOOK

2020 is expected to be an extremely active and potentially transformational period for the Company. The recent $25 million financing and the farmout of Block 2B will allow the Company to participate in up to four high-impact exploration wells offshore South Africa. The planned wells are all targeting material prospects with relatively high chances of success.
 

Map source: Africa Energy

The Block 11B/12B joint venture operated by Total has embarked on an ambitious exploration program offshore South Africa to follow-up on the large Brulpadda light oil and gas condensate discovery in February 2019. The fully-processed Polarcus 3D dataset confirms the large resource potential of the Paddavissie Fairway. The expanded Shearwater 2D seismic survey is complete, and the onboard fast-track processing has identified significant prospectivity with encouraging seismic indicators across the new Kloofpadda lead to the east. The scope of the PGS 3D seismic survey has been increased to cover a newly identified northern extension to the Luiperd Prospect. The multi-well 2020 exploration program on Block 11B/12B is expected to commence with the Luiperd well in June and will target several de-risked submarine fan prospects with substantial prospective resources. As the global coronavirus situation is fluid, we will update investors if there are material changes to the drilling schedule.

Management is focused on closing the Block 2B farmouts whereby the Company will be carried through the next exploration well, Gazania-1, expected to spud by the end of 2020. Block 2B has significant contingent and prospective resources in shallow water close to shore, including the A-J1 discovery from 1988 that flowed light sweet crude oil to surface. The Gazania-1 well will target two prospects in a relatively low-risk rift basin oil play up-dip from the discovery.

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