Premier Oil to acquire stake in Kenyan oil block

Exploration and production company Premier Oil has signed a farm-in for 55% of Taipan Resources’ licence interests in Block 2B, onshore Kenya.

Taipan will retain a 45% interest in the block, which is located in the Southern Anza basin, a cretaceous rift basin with source rock that contains several prospects.

The Pearl-1 prospect, with an estimated gross prospective resource of 100 million barrels of oil (mmbbls), will be targeted by the initial well.

The remaining lead inventory has the capacity to deliver more than 500mmbbls gross.

As part of the agreement, Premier Oil will pay back costs of $1m to Lion Petroleum, a wholly owned Kenyan-based subsidiary of Taipan.

The company will also pay Taipan’s working interest share of the cost of drilling and testing the Pearl prospect and future costs on Block 2B up to a cap of $13.275m. It can assume operatorship of any future development on the block.

Premier Oil chief executive Simon Lockett said that the company has obtained acreage in the emerging onshore rift plays of East Africa.

"Rift basins are a core play for Premier and in this instance we have gained access to a play opening opportunity with meaningful follow on potential," Lockett added.

Taipan Resources CEO Maxwell Birley said: "The Pearl-1 exploration well is targeting a Tertiary prospect similar to Tullow’s Ngamia, Twiga and Ekales discoveries. The Company also has multiple prospects similar to Tullow’s Eutko discovery.

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Image: Map of Premier Oil’s interests in Kenya. Photo: courtesy of Premier Oil.