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Afren acquires 74 per cent stake in Tanzanian oil bloc

By on March 25, 2011

AFREN Plc, yesterday, announced the acquisition of a 74 per cent working interest in the Tanga Block, located onshore and offshore Tanzania, from Petrodel Resources Limited.

Afren, an indigenous oil company quoted on the London Stock Exchange, said the Tanzanian oil firm would retain a 26 per cent interest in the block.

The company also agreed to reimburse Petrodel a percentage of the back costs in relation to the block.

Similarly, Afren would also fund all costs associated with the acquisition, processing and interpretation of an agreed seismic survey over the block amounting to 900 km of shallow and deeper water 2D coverage, after which, when supported by the seismic, the Nigerian oil firm would carry Petrodel through the drilling of one shallow water exploration well subject to a cumulative cap on gross costs of US$40 million.

The Tanga block lies Northernmost Coastal Tanzania, directly South of and adjoining Kenyan blocks L17 and L18 in which Afren holds a 100 per cent interest.

The licence includes onshore, shallow marine and deep marine areas.

The block, according to the company is covered by 200 kilometres of legacy 2D seismic data, and 1,200 km of good quality new 2D seismic data covering mainly the deeper water area, which was acquired by Petrodel.

The Tanga block is well located as it includes a deep basin with a very thick sedimentary section that has the potential to host several source rock intervals and reservoir/seal pairings.

Potential petroleum products in the block to date include are lower cretaceous sands deposited in deltaic to shallow marine environments, upper cretaceous submarine fans, eocene shelf sands and miocene fluvial and deltaic sands.

There are structures, particularly along the western flank of the basin, which are interpreted to form viable traps.

Some of these lie in shallow water and could present relatively inexpensive drilling targets.

The Tanga block is also a possible source of charge into the southern parts of adjacent Kenya block L18. Oil seeps and shows encountered in previous wells drilled on the nearby Pemba Island attest to the oil potential of the block and surrounding area.

The prospects advanced to date have been defined on the existing 2D seismic grid.

Source : Guardian