SacOil Quarterly Operations Update
SACOIL HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1993/000460/06)
JSE share code: SCL AIM share code: SAC
(“SacOil” or “the Company”)
SacOil Quarterly Operations Update
SacOil, the South African based, independent African oil and gas company listed on the JSE and AIM (JSE: SCL / AIM: SAC) is pleased to provide the following update on the Company’s on-going operational activities in the Democratic Republic of Congo (“DRC”), Nigeria, Malawi, and Botswana.
SacOil, under the guidance of its new board of directors, remains focussed on delivering its vision to build a balanced portfolio of assets from exploration to established production and cash flow in Africa.
The Company is pleased with the progress of its existing portfolio of exploration and appraisal assets, and continues to evaluate a number of opportunities to secure new value accretive acreage in other established and prolific African hydrocarbon basins.
- DRC, Block III: 2D seismic data planning and acquisition
- Nigeria, OPL 233: Execution of 2013 work program and 3D Seismic data acquisition
- Nigeria, OPL 281: Re-interpretation of seismic and well data
- Malawi, Block 1: Planning of environmental and social impact assessment
- Botswana, granting of Licenses 123, 124 and 125
DRC, Block III: 2D seismic data planning and acquisition
As previously announced, Total E&P RDC (“Total”) successfully acquired an airborne gravity and magnetic survey over the northern part of Block III outside the Virunga National Park.
The interpretation of the processed gravity and magnetic survey confirms the geological trend observed in the adjacent concessions in Uganda. Features similar to those found to be oil-bearing in Uganda in the Albertine Graben have been observed and identified with the new data. With this positive and exciting geological information, planning for the acquisition of a 2D seismic survey has begun. The current design envisages the acquisition of a minimum of 400 km of 2D seismic data.
There has been a delay of approximately six months to the planned work program, as a result of civil unrest to the south of our area of activity. With the situation on the ground now stabilised, it is anticipated that the seismic acquisition will take place within the next dry season in Q1 2014.
Nigeria, OPL 233: Execution of 2013 work program and 3D Seismic data acquisition
As previously reported the Work Program and the Work Program Budget for 2013 were approved by National Petroleum Investment Management Services (NAPIMS) during March 2013. Following the approval, the OPL 233 JV Partners (the “JV Partners”) have reworked the existing seismic data on OPL 233, and incorporated further data on the South-Western portion of the concession, providing an integrated geological understanding of the acreage and the region.
Whilst inherent uncertainties remain in the current data due to the dated vintage, poor quality and uncertain navigation parameters, the JV Partners remain optimistic on the contingent resources and potential upside. In addition, the JV Partners have identified a number of additional prospective leads for subsequent investigation and possible drilling.
Execution of 2013 work program
In preparation for the 3D Ocean Bottom Cable (“OBC”) Seismic survey on OPL 233, a contract for Environmental Impact Assessment (EIA) has been awarded to Tidalflow Nigeria Limited. Tidalflow has already completed the wet season sampling on schedule, and will undertake the sampling for dry season during November 2013.
Seabed Hazard Survey: Further to an invitation to tender to qualified companies for a geohazard survey over OPL 233, involving surveying the OPL 233 seafloor with sidescan sonar apparatus, a preferred contractor has been selected and discussions towards the finalization of the contract and mobilization to site are underway.
3D OBC Seismic Survey: Three companies were invited to tender for the contract to conduct the survey to acquire 3D OBC Seismic Data. The JV Partners have completed the evaluation processes with respect to the Technical and Commercial bids, along with the representative from NAPIMS. Requisite site visits were carried out to do a physical evaluation of equipment tendered by the bidders. The contract was subsequently awarded to the Geomarine, and discussions towards the finalization and mobilization of the OBC seismic survey are underway.
3D OBC Data Processing: Similarly, tenders have been invited for the data processing of the 3D OBC Seismic survey. The tenders have been evaluated and a preferred contractor has been identified with award process to be finalized within the next couple weeks.
Nigeria, OPL 281: Re-interpretation of seismic and well data
Similar to OPL 233, SacOil has performed a technical review of the borehole and 3D seismic data on the lease. Management is satisfied that, despite some uncertainties in the data, the current estimate of contingent resources as reported by AGR TRACS, may be conservative and with further evaluation it is our opinion that the resources may actually be more substantial than initially anticipated. The potential increase in resources can be attributed to several deeper channel leads and prospects, which holds a possibility of adding to the prospective resources of OPL 281.
Malawi, Block 1: Planning of environmental and social impact assessment
At 12,265 square kilometres, Block 1 is the second largest petroleum exploration licence demarcated in Malawi. SacOil has an exclusive 100% interest and operator status in this block.
Block 1 is located in the North-Western part of Malawi bordering Tanzania to the north and Zambia to the west. The licence area is located on trend with the East African rift system which is a proven exploration province with prolific oil discoveries in Sudan, Chad, Kenya and Uganda. Through initial work completed, the SacOil technical team anticipates that the same Tertiary rift system will be present in Malawi which may, therefore, potentially yield deposits of hydrocarbons.
Following the award of Block 1, in Malawi, December 2012, initial planning associated with the environmental and social impact assessments are underway. In consultation with the Malawian government, SacOil is currently targeting to have all environmental work completed by Q3 2014.
Botswana, Licenses 123, 124 and 125
SacOil has embarked on a process of collating all geological information available on the petroleum prospectivity pertaining to these licences. A review of this information is currently underway. The three licences cover an area of approximately 49,463 square kilometres.
Jordaan Fouche, VP Technical, commented:
“SacOil continues to make strides on understanding the technical and commercial merits of the projects through the execution of the work programs on the assets. We remain confident and optimistic that expenditures on the Nigerian assets will result in additions to the Company’s existing resources and ultimate conversion to reserves and hydrocarbon production.”
Qualified Person Review
This release has been reviewed by Bradley Cerff, Vice President Operations, who is a member of the Society of Petroleum Engineers with 16 years’ experience in petroleum exploration and management. Bradley Cerff has consented to the inclusion of the technical information in this release in the form and context in which it appears.
08 November 2013
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