Pangani Licence, Tanzania

Overview

The Pangani licence is a large frontier licence (17,156km2) located in the Pangani Rift, on one arm of the Northern Tanzanian Divergence triple junction. The rift is part of the East African Rift System that, in the west, runs from Uganda to Malawi, and in the east from Kenya to Tanzania. Over 2 billion barrels of oil has been found in the Lake Albert area, Uganda and recently oil was found in the Lokichar Basin in Kenya. The Pangani Rift is believed to contain sediments of Pliocene age, and possibly some Late Tertiary successions.

Hydrocarbon Prospectivity

Between mid-November and late December 2013 the Company acquired 200km of 2D seismic over the Moshi and Mvungwe basins, two basins within the Pangani licence that had been identified from interpretation of the gravity-magnetic results acquired by Swala’s 2012 airborne survey. During 2014 the Company acquired a further 200km of 2D seismic over the Moshi basin, fulfilling its work commitments for the Third Contract Year.

Moshi Basin

The results from the survey show that the Moshi basin, located to the north of the licence area, appears to be a deep basin with sedimentary fill of probable Neogene age.  Further evidence from the seismic survey suggests that the basin is fault-bounded, some 25km wide, and with basin fill of between 2,000 and 3,000m. Basement however may be deeper than this as data processing is affected by the likely volcanics within the sediment pile. Basin fill of this magnitude is encouraging for hydrocarbon generation from any source rocks present, given the high heat flows in the area.

Forward Plans

The Company has completed its Third Contract Year obligations and is now committed to drill one well in the Pangani licence.  Initial studies have clarified the operational issues associated with drilling in Pangani and confirmed estimated drilling costs below $10 million (gross).  Discussions with other operators are ongoing with the aim of exploring possible synergies between drilling programmes so as to reduce this estimate further.  The Company is now processing and interpreting the seismic data with a view to identifying suitable drilling targets for 2015.