andarko & others, page-22

Canadian firm Vanoil’s contract for oil exploration extended

By Kennedy Senelwa

Posted Saturday, February 16 2013 at 16:16

Canadian explorer Vanoil Energy has received a deadline extension to finish drilling a well for crude oil in northeastern Kenya.

The firm was previously obligated to finish drilling its first well by April 30 this year. Under the terms of the extension, Vanoil must only commence drilling its first well before July 31.

The company may place its first two wells anywhere within the boundaries of Block 3A and 3B to satisfy the obligations within the initial exploration period.

In October, the Vancouver-based company signed a production sharing contract (PSC) with the Kenyan government.

“The time extension allows us to drill our first two wells in rapid succession. The ability to place both wells anywhere within the boundaries of 3A and 3B also gives Vanoil flexibility to target its most exciting prospects,” said Vanoil chief executive officer Aaron D’Este.

It is estimated that the area contains more than 900 million barrels of oil equivalent (BOE), as it is positioned between Tullow’s recent oil discovery onshore and Apache’s offshore gas well.

“We view 2013 as a transformational year for the company. We now have the time and operational flexibility to extract maximum value from our assets,” said Mr D’Este.

Meanwhile, Far Ltd of Australia is preparing to drill an offshore well in Block L6 in Lamu at the Kenyan Coast.

“Planning activities for drilling in 2013 have commenced. A tender for drilling project management services has been issued and environmental impact assessment is well advanced,” said Far’s managing director Cath Norman.

Far, Pancontinental Oil and Gas NL own 60 per cent equity and 40 per cent shares respectively in L6.

Ms Norman said the success in the wells will be significant for Far’s exploration areas L6 and L9 blocks.

Far is seeking a partner for drilling the wells. The company started the first quarter of 2013 with cash position of $17.4 million, and long term cash deposits of $5.8 million.


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