Simba Energy Inc. (TSXV: SMB) on April 22, 2014, announced that it has signed an agreement with Bell Geospace to conduct a comprehensive airborne FTG (Full-Tensor Gradiometry) survey on Block 2A in Kenya, in which it holds a 100% interest in the Production Sharing Contract. The survey, which will involve up to 6,044 line kms over two target areas, is expected to start in early May and be completed approximately 30 days later.
Data from this FTG will also be combined with some additional 2D seismic data expected shortly from Taipan Resources, which was granted permission by Simba Energy to acquire limited 2D seismic on Block 2A. Simba expects that the survey data will lead to a more focused and cost effective 2D seismic well location targeting program planned for later this year. FTG results are the criteria larger energy companies and drillers use to determine actual drill targets.
Taipan has a 30% interest in the adjacent Block 2B, with a subsidiary of Premier Oil plc holding an option to earn up to a 55% stake in 2B following a farmout agreement in which Premier said it would pay up to US$30.5 million of the Block’s exploration costs. When the deal was first announced Premier said it believed 2B’s Badada prospect had an estimated gross prospective resource of 100 million barrels of oil with the remaining lead inventory capable of delivering in excess of 500 million barrels. Taipan expects to drill its first well on Block 2B during the fourth quarter of 2014.
Simba Energy’s Block 2A’s concession area overlies the southern extents of the Anza basin, with a geological setting similar to the South Lokichar basin where Africa Oil and Tullow have recently discovery more than 300 million barrels of oil. Africa Oil is currently drilling its Sala-1 prospect on Block 9 there, with results expected sometime during the second quarter of 2014.
Africa Oil’s well on the Sala prospect in Block 9 and Taipan’s Badada-1 well on the south border of Block 2A strongly suggest that a potential “String of Pearls” (the name given to the geological fault trend in Lokichar basin) passes through the southwestern corner of Simba Energy’s Block 2A, as both prospects are located at the basin edge where this type of play is found. The Anza basin’s edge passes through the western part of Block 2A.
“Kenya is the hottest area in Africa right now and there’s a lot of exploration activity happening around our company’s prospects. Africa Oil has had a huge success drilling and they’re drilling right now no more than 50 miles away from our block,” says Simba Energy President & CEO Robert Dinning, in an interview with SmallCapPower.com, adding that he believes Africa Oil is on the verge of a big discovery.
Simba Energy also stated that as a result of a significant increase in drilling activity adjacent to its Block 2A, it is currently in discussions with various companies who have expressed interest in working with it by farming directly into Block 2A and conducting both the seismic program and in drilling the first wells under the terms of a farm-in agreement. Energy juniors such as Simba are turning increasingly to Production Sharing Contracts (PSC) and farm-in agreements as institutional financings are becoming more and more difficult in this economic environment.
To learn more about Simba Energy, you can view their initiation research report, research bulletins, analyst commentaries and CEO video interview on their SmallCapPower.com Investor Hub: Here
About Simba Energy:
Simba Energy Inc. (TSXV: SMB) is an independent Canadian-based oil and gas exploration company with active onshore PSCs in Kenya, Guinea and Chad. Simba is exploring and developing onshore oil and gas prospects in under explored regions across Africa.
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