ERHC Energy Inc. (ERHE) is a publicly traded American company with oil and gas assets in Sub-Saharan Africa. Over eighteen months to two years, ERHC has acquired additional exploration blocks in Chad and Kenya to complement its existing offshore blocks in the Joint Development Zone offshore São Tome and Principé.
On May 6, 2013, an important announcement was made regarding ERHC’s Kenya operations.
Kenya Farmout Partner
ERHC announced that it has signed a letter of intent with an integrated international oil and gas company to farm-out part of the Company’s interest in Kenya Block 11A.
The Company announced that its potential partner is a renowned multinational operator with exploration and production interests spread across several continents. The parties will now proceed to negotiate the definitive terms for a farm-out. Any agreement reached will be subject to the approvals of the respective boards and of the Government of Kenya.
In July 2012, ERHC signed a production sharing contract (PSC) with the Kenyan Government on Block 11A, an oil and gas exploration Block in northwestern Kenya. The Block is situated on the border of South Sudan to the north, Block 11B and Lake Turkana to the east and near Kenya’s border with Uganda to the west. It encompasses 11,950 square kilometers or 2.95 million acres.
Until a definitive farm-out agreement is entered into and approved, ERHC continues to operate Kenya Block 11A. ERHC’s work program under the PSC is continuing apace. The Company is currently reviewing bids from several service companies for process management and execution of a Full Tensor Gravity Gradiometry (FTG) survey of the Block. The FTG survey is an airborne survey that aids significantly in the structural mapping of prospective hydrocarbon basins. It has been used successfully in Africa and contributed to recent oil discoveries in Uganda and Kenya.
Location is Key
Kenya sits at an interesting position at the intersection of two major rift systems – the Cretaceous Central African rift system and the Tertiary East Africa rift system (see map). The company is pursuing the same kind of rift margin play that has yielded major discoveries in neighboring Uganda as well as recent large discoveries in Kenya to the east of its Block 11A.
In addition to its oil and gas exploration interests in the Republic of Kenya, the Company holds interests in the Republic of Chad, the Sao Tome and Principe Exclusive Economic Zone (EEZ) and the Nigeria-Sao Tome and Principe Joint Development Zone (JDZ).
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