ERHC Energy, the publicly traded, Houston-based independent oil and gas firm with several highly valuable assets in Sub-Saharan Africa, offered markets an update today on the company’s planned exploration work programs for their operations in Kenya and Chad.
This story breaks amid a fervor of fund raising by the company to facilitate an increasingly aggressive exploration campaign across East, Central, and West Africa. Immediate goals of the current activity in Kenya and Chad will be to identify the lead targets so that a comprehensive drilling package can be put together. Pending success with the geological, geophysical, and subsequent analytical work being done on the properties, as well as the availability of certain financing requirements, the company is looking to go full-bore in both countries as soon as possible to meet the production sharing contract drilling commitment minimums of one well each (with options to drill more during the terms of the contracts).
The company will look to finance via equity issuance and appropriate debt instruments, as well as via arrangements currently being made through potential partner talks over the Chad/Kenya interests. Collectively the company has put together a beautiful footprint on the continent and some 100% WI opportunities expected to close with local government officials before the end of the year in the Sao Tome and Principe Exclusive Economic Zone (blocks 4 and 11, option to acquire as much as 15% in two more blocks), as well as some working interests held in the Nigeria-Sao Tome and Principe Joint Development Zone (blocks 2-6 and 9).
The company looks to get started in Kenya by the end of this year in the Lotikipi plain at block 11A, where a strong in-trend relationship exists to Southern Sudan’s established Abu Gabra Rift basins, suggesting an extremely positive oil and gas abundance correlation. This massive (63 miles across) depression will be explored over an initial two year period, with the environmental impact assessment work and analytical data aggregation taking top priority. ERHC has planned full tensor gravity surveying by air, accompanied by 2D seismic and geological field studies, in order to fully resolve the structural portrait of key targets and tectonic horizons for the region. Follow up 3D seismic work may become necessary to better define resources identified during analytical integration and mapping of the other data sets, a potential outcome for which the company is currently preparing.
A similar approach in Chad is slated to begin in early 2013, with the 100% interest in Southern Chad at BDS 2008 taking priority, again a target which is on-trend with a solid lead vector, in this case the successful Doba Basin oilfield (average of 122.5k bopd in 2010). Technical assessments by the operator of an analogous, adjacent block, upon close scrutiny by ERHC, offers abundant promise of at least three prospects with a reasonable chance of success on the company’s blocks. ERHC is projecting a combined mean potential as high as 63M boe, with a whopping 332M boe potential upside. The same discrete analysis is being performed here as in Kenya, with existing well logs thrown into the complex array of data sets that will be aggregated for resource mapping purposes, and the company stands again at the ready to execute with full 3D seismic work consequent upon the need to further delineate identified resources/structures. Secondary targets will be the Manga and Chari-Ouest Block 3, which are also adjacent to the prolific Doba Basin oilfield.
With a serious footprint on the continent and in the Gulf of Guinea, ERHC Energy is rapidly making a name for itself within the industry and investors will be keen to stay abreast of developments as the company’s financing/development efforts progress.
To learn more about ERHC Energy, please visit the company’s website at: www.ERHC.com
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