namibia, page-8

Wasa, Baniyas has much greater potential. Why? It is within 10-15 kilometres of infrastrucutre that forms part of the Thevanard Island Production Facility (owned by Chevron, Santos and Exxon). Baniyas is expected to host a gas cap with an oil legs. Current estimates are 24-30 million barrels of recoverable oil with around 35 BCF of gas. Making Baniyas a 40 mmboe prospect. CVN pulling out has gifted PCL a further ~20% interest, which will leave PCL with ~20% interest in Baniyas after a 2:1 farm-out.

If we just look at the oil, there's ~5 million barrels of oil net to PCL. In ground value will definitley be around $5 for 3P reserves and $10+ for 2P reserves, given proximity to infrastrucutre. Oil is currently trading at around $80/bbl so you can understand how valuable an asset Baniyas would be in the event of discovery.

The issue with Stokes is that Buru is involved. I'm not sure if you follow Buru, but they have a gas sales agreement with Alcoa for 400pj plus and additional 100 Pj (conditional). Alcoa forwarded Buru $40 million for their Canning Basin program and Buru must deliver them gas by 2013 or they will be required to refund the $40 million. In the event Stokes is a gas field, Buru will want it for themselves. They will probably buy the minor Stokes interests (in the event of discovery) from other JV partners like PCL, to begin securing gas to meet their contract.

First GOP de-list, then they give PCL problems, now they change their name. All I can say is what next? They are getting ready for the 2D to commence later this year, while at the same time still searching for a farm-in partner. I am expecting some work from CNOOC on Lamu 2 this year, so hopefully that will spur some L6 developments along. Onshore Lamu is anticipated to have decent potential for gas and wet gas finds. Kudu is the primary onshore lead and Kipini the primary offshore lead in L6. Developments at Mbawa will highlight the potential for offshore developments in L6. Keep in mind the play types will most likely be entirely different.

A significant discovery in Kenya is what is really needed to kick start PCL. Every other African nation has significant O&G interest from majors, except Kenya. Right now Kenya only has CNOOC and Anadarko as majors operating in their O&G provinces. Then a mid-tier player in ORG and small fries, such as PCL, AoI, Aminex, etc...