East African Oil Goes Boom

 

SOURCE:[ Prospecting News] - In 1977 there were 1 million cars in China. Today there are 51 million. Mob scenes at Toyota dealerships in Beijing are evidence that this trend is not going away.

Global oil demand grew by 800,000 barrels a day in 2012 and is forecast to increase a million barrels a day for 2013.

The cheap easy oil is gone with the possible exception of East Africa, which is still largely unexplored by international oil companies.

“East Africa is one of the few remaining onshore under-explored regions of the world with proven hydrocarbon systems, enormous geological potential and vast amounts of exploration acreage held by relatively few companies,” states a recent Cormark Securities Report, “Tullow and Heritage’s billion barrel discovery in the Lake Albert basin of Uganda in 2007 have reignited exploration interest.”

Since the spring of 2012, Energy Analysts have shifted their interest to Kenya where Tullow Oil (TLW-LSE) and Africa Oil (AOI-TSX) announced that the jointly drilled Ngamia-1 well hit 100 meters of net play. AOI went from $250 million market cap to over $2.5 billion at the peak on the back of the Ngamia discovery.

Afren PLC (AFR-LSE), a U.K. based oil explorer has also surged amid speculation of positive imminent drilling results from its Paipai well in Kenya.

"The Anza Basin is one of the largest Tertiary-age rift-basins of the East African Rift system which contains multi-billion barrel oil discoveries,” stated Birley, “we continue to believe based on existing gravity, magnetic and seismic data that the 'sweet spot' of the Anza Basin is located on Block 2B.”

Birley, who lives full time in Kenya, has previously worked for Marathon Oil and Premier Oil in Africa and Asia. He has been a key player in the discovery of nearly 2 billion barrels of oil. Birley’s three decades of exploration and production experience has been land-based. This makes him a rare commodity, as most oil and gas management in East Africa has been focussed on off-shore development.

Vanoil has 3A in the same Anza Basin and will drill before Taipan.