Africa Oil Corp. (“Africa Oil”, or the “Company”) announces an increase in the group’s direct interest in Block 3B/4B, offshore South Africa, to 18.0%. This block lies to the southeast and on trend with a number of Orange Basin oil discoveries including Venus, and is operated by TotalEnergies.
The Company and its wholly-owned subsidiary, Africa Oil SA Corp. (“AOSAC”), have completed a transaction with Eco (Atlantic) Oil & Gas Limited (“Eco”) and Azinam Limited (“Azinam”), a subsidiary of Eco, whereby Azinam has transferred a 1.0% (one percent) interest in Block 3B/4B to Africa Oil (the “Transaction”). In consideration, Africa Oil has exchanged the shares and warrants that it held in Eco for cancellation.
Africa Oil Chief Executive Officer, Dr Roger Tucker, commented: “This transaction is another step in delivering the strategy of increasing direct interest in Africa Oil’s key assets, including our opportunity set in the Orange Basin, a region with high levels of industry interest and activity. We thank Eco Atlantic's management for their collaborative approach in working with us since 2017, and we look forward to further progress towards the drilling of the first exploration well on Block 3B/4B.”
About Block 3B/4B
Block 3B/4B covers an area of 17,581 km2 within the Orange Basin offshore South Africa in water depths ranging between 300m and 2,500m. This block lies to the southeast and on trend with a number of oil discoveries including Venus. There is approximately 14,000 km of 2D seismic and 10,800 km2 of 3D seismic over Block 3B/4B, identifying a large opportunity set of exploration prospects, with the majority of the prospects lying in approximately 1,500m of water.
On August 28, 2024, the Company announced the closing of a farm down agreement for Block 3B/4B with TotalEnergies and QatarEnergy. AOSAC retained a direct 17.00% interest and transferred the operatorship of the block to TotalEnergies, for a maximum consideration of USD 46.8million, this includes the exploration carry for its retained interest, that is expected to be sufficient for two exploration wells. AOSAC will have the benefit of exploration carry for the additional 1.00% interest assigned to it by Azinam.
An Environmental Authorization for exploration activities (drilling of up to 5 exploration wells) was granted by the Department of Mineral Resources and Energy for the Republic of South Africa on September 16, 2024. The legislative notification and appeals process is ongoing with the relevant regulatory agencies.
The Africa Oil group now holds a direct 18.00% interest in Block 3B/4B. Other partners in the block are: TotalEnergies with a 33.00% operated interest; QatarEnergy with a 24.00% interest; Ricocure with a 19.75%; and Eco with a 5.25% interest.
Africa Oil’s Eco Securities
Immediately prior to the Transaction, the Company held 54,941,744 Eco shares and 4,864,865 in Eco warrants that represented 14.84% of the outstanding common shares of Eco, 9.11% of the outstanding warrants of Eco and 15.95% of the outstanding common shares of Eco on a partially diluted basis (after giving effect to the warrants owned by Africa Oil) and represented the entire security holding of Africa Oil in Eco. The Company has exchanged these securities for cancellation by Eco and no longer owns any securities of Eco. Accordingly, Africa Oil is no longer subject to the early warning reporting requirements in respect of Eco, as Africa Oil has fallen below the 10% reporting threshold.
Africa Oil acquired the common shares and warrants of Eco for investment purposes. Africa Oil will review its holdings from time to time and may in the future acquire additional securities of Eco and/or dispose of such securities subject to a number of factors, including general market and economic conditions and other available business opportunities in the future.
Additional Information
This press release is being issued pursuant to National Instrument 62-103 – The Early Warning System and Related Take-Over Bid and Insider Reporting Issues, which also requires a report to be filed in accordance with applicable securities laws (the "Early Warning Report"). A copy of the Early Warning Report will be available under the Company's profile on SEDAR+ at www.sedarplus.ca, or by contacting Shahin Amini at shahin.amini@africaoilcorp.com or +44(0) 20 8017 1511. This press release contains inside information that Africa Oil Corp. is required to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out above, at 02:00 a.m. EST on January 13, 2025.