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Commencement of exploration work programme on Block 3 of the Albertine Basin, Lake Albertine in the DRC


(Formerly SA Mineral Resources Corporation Limited)

(Incorporated in the Republic of South Africa)

(Registration number 1993/000460/06)

Share code: SCL and ISIN: ZAE000127460


Commencement of exploration work programme on Block 3 of the Albertine Basin, Lake Albertine in the DRC

SacOil, the Pan African independent upstream oil and Gas Company, is pleased to announce it has commenced its exploration work programme on Block 3 of the Albertine Basin, Lake Albert in the Democratic Republic of the Congo (“Block 3”).

SacOil`s announcement follows its completion, on Monday, 20 September 2010, of its acquisition of 50% of SacOil (Pty) Limited, the signatory to the Block 3 Production Sharing Agreement.

Appointment of exploration management

SacOil has appointed Mr Glen Penfield as its Senior Exploration Advisor in respect of Block 3. Glen, has more than 30 years of professional experience in hydrocarbon and mineral exploration, geophysical contracting, project management and business development in more than 35 countries but primarily in Africa and specifically within the Democratic Republic of the Congo (“DRC”). Glen is both a geologist and geophysicist.

He has participated in a number of significant oil, gas, and mineral discoveries around the world during a career with companies such as Western Atlas International, Fusion, and ConocoPhillips, and consultancy with PEMEX, the Mexican NOC among many others.

Glen has worked throughout Africa on multiple projects in 18 countries, publishing on 6 different African countries. He is a noted mentor of scientific talent, having supervised or trained a number of now prominent geoscientists, many during his eight year tenure as Manager of Integrated Interpretation Services at the Western Atlas International group of companies.

Work programme

SacOil is utilizing a `Faster, Better, Cheaper` approach to exploration in Block 3. What this means specifically is that at the outset of SacOil`s campaign, SacOil will make the fullest use of low cost airborne geophysics and remote sensing technologies, guaranteeing that SacOil`s basic studies will be conducted over the entire license area in a rapid but comprehensive manner to allow passing to seismic program delineation of leads into prospects in a thorough and systematic fashion with no ‘backtracking’.

SacOil is currently tendering (tender closing date 8 October 2010) for a high resolution airborne gravity and magnetic survey which will begin in 4Q 2010 or 1Q 2011 and will start with a `Quick Look` grid of the entire license area and key adjoining ground truth areas to be followed immediately by a very high resolution, tight grid, infill survey over the most promising areas.

Gravity data particularly have proven to be of extraordinary value in defining the details of The Albertine Graben`s geological structure. SacOil believes its approach will result in shorter timelines and better decisions from the outset.

The high density contrast between the pre-cambrian basement rocks on the rift`s margins and the low density tertiary and possible pre-tertiary sediments overlying the basement allows gravity data to be used to great effect in identifying leads for seismic detailing as well as defining hydrocarbon source rock `kitchen` areas.

Our initial survey will also rapidly address the issue of CO2 associated with igneous bodies, definitively showing (we expect) that this risk element is limited to the Turaco area in Uganda.

SacOil is simultaneously creating a catalog of high resolution satellite and aircraft imagery of Block 3 to aid work in surface geology, planning, and environmental assessment. SacOil is also planning on contacting and liaising with university researchers and non-governmental organizations (“NGOs”) which may have ongoing studies in the Block 3 license area or adjoining portions of the Semliki River Valley and Delta.


SacOil has already raised R48 million (some US$7 million) by way of general issue of shares for cash from STANLIB Asset Management Limited (“STANLIB”) and Metropolitan Asset Managers Limited (“MetAm”). STANLIB was established in 2002 through the merger of Liberty and Standard Bank`s asset management, wealth management and unit trust interests. STANLIB is wholly-owned by the Liberty Group, of which the Standard Bank Group is a major shareholder, together with a diversified spread of BEE organizations dedicated to the advancement of the previously disadvantaged. STANLIB has over 400 000 clients and a presence in eight African countries. STANLIB has a proud record of being one of the top investment managers and the leading unit trust company in South Africa with in excess of R330 billion (some US$45 billion) of assets under management and administration.

Metropolitan Asset Managers is a wholly owned subsidiary of Metropolitan Holdings Limited (“Metropolitan”), an empowerment holding company listed on the JSE Limited. MetAM initially functioned as the investment arm of Metropolitan managing internal funds and a range of collective investments. In 1997, it became a separate business unit and in 1999, was set up as a corporate entity with its own board of directors. MetAM is one of the large asset managers in South Africa, managing assets in excess of R110 billion (some US$15 billion).


Commenting on the commencement of the Block 3 work programme, Robin Vela, SacOil CEO, said “We are keen to fast track our work on the DRC side of the Albertine Graben to catch up with that done by others on the Uganda side of the Albertine Graben. Now that we have commenced our work programme, our next logical objective in the area is to achieve a high level of co-operation between the various licensed parties in the area and higher levels of co-operation between the two governments. We will look to commence work on the same without undue delay or deliberation” Glen Penfield added, “We have significant confidence of the area given the establishment of the existence of a petroleum system in the area. We believe that the reservoir risks ascribed by the independent economic models of contingent resources within Block 3 were too great and that consequently the resource base may be significantly greater than previously estimated.”


30 September 2010


BDO Corporate Finance


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