Tullow Hits Oil in Kenya
Wednesday 17 May 2017
London-listed company Tullow Oil has hit pay with an exploration well on Block 13T in northern Kenya.
The company revealed Wednesday the Emekuya-1 had been drilled to a total depth of 1356 metres and 75 metres of net oil pay across two zones.
The well penetrated reservoir quality sandstones, with downhole pressure measurements and fluid samples suggesting the main oil reservoir was on the same static pressure gradient as the Etom-2 well, which lies 2.5 kilometres to the south.
Tullow added that this demonstrated a major part of the Greater Etom structure was oil-filled, with the reservoir sands also appearing to be extensive, further de-risking the northern play area.
"The Emekuya-1 exploratory appraisal well has made an important discovery in the northern part of the South Lokichar basin,” Tullow exploration director Angus McCoss said.
“This well has proven oil charge across a significant part of the Greater Etom structure and we are very encouraged by the quality and particularly the regional extent of the reservoir.”
The well was drilled using the drilling rig PR Marriott Rig-46 which will now be moved to to drill an up-dip appraisal well on the Greater Etom structure.
Tullow operates Blocks 13T and 10BB with 50% equity and is partnered by Africa Oil and Maersk Oil which each hold a 25% share in the blocks.
A market note from BMO Capital Markets read: "The discovery looks promising versus the around 100 metres of net pay encountered at Etom-2.
"We carried around 50 million barrels for Emekuya-1, which we estimate is worth around 8 to 10 cents per share to [partner] Africa Oil and further underpins a development in Kenya.
"Prior to any changes, Africa Oil is trading at around a 20% discount to our Core net asset value. We maintain our 'Outperform' rating on Africa Oil stock."