Africa Oil Corp. (“Africa Oil”, or the “Company”)
is pleased to announce its wholly-owned subsidiary, Africa Oil SA Corp. (“AOSAC”) has signed a strategic
farm down agreement (“Agreement”) with TotalEnergies EP South Africa B.V. (“TotalEnergies”) and
QatarEnergy International E&P LLC (“QatarEnergy”) for the Orange Basin Block 3B/4B, offshore South
Africa. Through AOSAC, the Company currently has an operated 26.25% interest in Block 3B/4B and has
entered the Agreement jointly with its partners Eco (Atlantic) Oil & Gas Limited (“Eco”) and Ricocure
(Proprietary) Ltd (“Ricocure”), through their respective subsidiaries.
On completion of the transaction, Africa Oil will retain a 17.00% interest and the operatorship of Block 3B/4B
will transfer to TotalEnergies.
Transaction Highlights:
• Maximum transaction value of up to $46.8 million to Africa Oil.
• Africa Oil will receive, subject to achieving certain milestones defined in the Agreement, staged
payments for a total cash amount of $10.0 million, of which $3.3 million is payable at Completion,
as defined below, and the remaining balance in two successive payments conditional upon
achievement of key operational and regulatory milestones.
• Africa Oil will also receive a full carry of its 17.00% retained share of all JV costs, up to a cap, that
is repayable to TotalEnergies and QatarEnergy from production, and which is expected to be
adequate to fund the Company’s share of drilling for up to two wells on the licence.
Completion of the Agreement (“Completion”) is subject to the satisfaction of customary conditions
precedent, including approvals from the government of South Africa.
Africa Oil Chief Executive Officer, Dr Roger Tucker, commented: “Attracting TotalEnergies and
QatarEnergy as our new partners in Block 3B/4B is an endorsement of the exploration potential of the block.
These opportunities are on trend with the discoveries in Namibia’s Orange Basin, including Venus in Block
2913B. Both companies have deep geological knowledge of the basin with successful nearby discoveries.
TotalEnergies, as the new operator, also brings extensive deepwater drilling and development expertise.
Africa Oil has an unrivalled position amongst its Independent E&P peer group in this world-class basin. This
includes our indirect interest in the Venus discovery and the on-going appraisal and exploration campaign
on Block 2913B.”
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 number of oil
discoveries including Venus and Graff. AOC has approximately 14,000 km2 of 2D seismic and 10,800 km2
of 3D seismic over Block 3B/4B and has identified a large opportunity set of exploration prospects, with the
majority of the prospects lying in approximately 1,500m of water.
Africa Oil currently has a 26.25% interest in Block 3B/4B with Eco holding a 20.00% interest and Ricocure
with a 53.75% interest. On the completion of the farm down transaction, which is subject to the satisfaction
of customary conditions precedent, including approvals from the government of South Africa, the interests
in Block 3B/4B will be comprised of: 17.00% held by Africa Oil; 33.00% held by TotalEnergies; 24.00% held
by QatarEnergy; 19.75% held by Ricocure; and 6.25% held by Eco. Africa Oil will transfer its operatorship
of Block 3B/4B to TotalEnergies on Completion.