Puntland Oil Update

[Abdi-Halim]

Africa Oil Operations Update
Market Wire
September 14, 2009


VANCOUVER, BRITISH COLUMBIA -- (MARKET WIRE) -- Sep 14, 2009 -- Africa Oil Corporation (“Africa Oil” or the “Company”) (TSX VENTURE: AOI) is pleased to provide an update on its East African oil and gas operations. The Company has assembled a highly prospective portfolio of oil and gas exploration assets in Kenya (Blocks 9, 10A and 10BB), Ethiopia (Adigala, Ogaden 2/6 and 7/8) and Somalia (Dharoor and Nogal) as well as attracting an excellent group of joint venture partners. The Company is the operator of all blocks except Block 9 in Kenya. Preparations for an aggressive drill campaign over the next two years have advanced significantly with the first well anticipated to spud by the end of October.


Kenya


The Bogal-1-1 well in Block 9 is expected to spud at the end of October, 2009. The rig, materials and other equipment are currently being mobilized from China. The Bogal well will target Jurassic reefal limestone and Cretaceous sandstones with a projected total depth of approximately 5000 metres. Numerous additional prospects have also been identified within Block 9 and are being evaluated for possible future drilling. CNOOC is the operator of Block 9.


Interpretation of reprocessed vintage seismic data from Block 10A is currently underway. The new data has provided a clearer image of vast sub-basins within the block. To supplement the existing data, approximately 750 kilometres of new 2D seismic will be acquired.


A technical re-evaluation of newly acquired Block 10BB is underway. As the block has an existing oil discovery (Loperot), various exploration strategies such as appraisal drilling, offset exploration drilling, and conventional 2D or 3D seismic exploration are being considered. Seismic acquisition is anticipated to commence in the second quarter of 2010.


Ethiopia


A 500 kilometre, 2D seismic acquisition program commenced in August on the Adigala block. Approximately 100 kilometres of data have been recorded to date with the balance expected to be completed in October, 2009. Preliminary evaluation of the Adigala seismic data acquired so far indicates that a prospective sedimentary basin exists within the Company`s acreage. Sedimentologic and geochemical analyses of outcrops along the periphery of the basin have shown the existence of reservoir rocks and oil prone source rock.


Upon completion of the seismic survey at Adigala, the contractor will mobilize to Ogaden Blocks 2/6 and 7/8 where a 500 kilometre, 2D seismic program is scheduled to commence towards the end of the year. The seismic program will target previously identified robust leads with a goal of maturing these leads to drillable prospects. The seismic program at Ogaden is expected to be completed by the end of the first quarter of 2010.


Somalia


Following Africa Oil`s successful acquisition of 775 kilometres of 2D seismic in the Dharoor Block, prospects for 2010 drilling are being finalized. Preliminary interpretations indicate the presence of robust prospects which have the potential to contain large reserve volumes.


The Company`s interpretation in the Nogal Block is complete. Excellent prospects have been identified and the first drill site has been firmed up on the Nogal South Prospect.


All preparations for the Somali drilling campaign are complete. However, drilling will only commence after agreement is reached in ongoing discussions with the new Puntland Government.


Africa Oil Corp. is a Canadian oil and gas company with assets in Kenya, Somalia and Ethiopia. Africa Oil`s East African holdings are in what is considered a truly world-class exploration play fairway. The Company`s total gross land package in this prolific region is in excess of 200,000 square kilometers - an area roughly the size of Great Britain. The East African Rift Basin system is one of the last of the great rift basins to be explored. New discoveries have been announced on all sides of Africa Oil`s virtually unexplored land position including the major Heritage/Tullow Albert Graben oil discovery in neighbouring Uganda. Similar to the Albert Graben play model, Africa Oil`s concessions have older wells, a legacy database, and host numerous oil seeps indicating a proven petroleum system. Good quality existing seismic show robust leads and prospects throughout Africa Oil`s project areas. The Company is listed on the TSX Venture Exchange under the symbol “AOI”.


ON BEHALF OF THE BOARD


Rick Schmitt, President


Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.


Contacts:


Africa Oil Corporation


Sophia Shane


Corporate Development


(604) 689-7842


(604) 689-4250 (FAX)


africaoilcorp@namdo.com


www.africaoilcorp.com


© Copyright 2009 Market Wire, Inc.


Canadian Oil Firm Set for East Africa
by Kennedy Senelwa
All Africa
September 14, 2009


Nairobi, Sep 14, 2009 (The Nation/All Africa Global Media) -- Raytec Metals Corporation has entered into negotiations to merge with Lion Petroleum Inc, a firm licensed to explore crude oil in Kenya.


The Toronto Stock Exchange listed company recently signed an agreement with Africa Oil Corporation that gives Raytec the right to earn an interest in 5 blocks in Kenya and Puntland, Somalia.


Raytec`s move to merge with Lion Petroleum which has oil prospecting rights in Mandera is part of the Canadian firm`s strategy to expand its presence in East and Central Africa region.


Gas assets


Lion, with offices in Nairobi, has the infrastructure in place to allow Raytec to continue building an Africa-based portfolio of oil and gas assets.


Raytec`s president Brian Thurston said the relationship is strategic as the firm is focused on becoming a significant player in the developing oil and gas industry in East and Central Africa.


“Raytec board members have laid out a critical path to achieve this goal, the first part of which was the recently announced farm-in agreement with Africa Oil Corporation,” he said.


Under a binding letter of intent signed by the two, the transaction is subject to certain conditions and completion of due diligence process.


The letter stipulates a business combination pursuant to which Raytec, or its subsidiary will acquire all of the 23,865,000 common shares issued and outstanding in the capital of Lion.


It is proposed that Lion`s chief executive Mike Devji becomes a director of Raytec, and then be appointed chairman of the board of directors of the firm. Mr Devji said the pair had decided to merge to create a bigger and more dynamic oil exploration company.


Lion is party to production sharing contract (PSC) relating to blocks 1 and 2B with the Kenyan Government. The PSCs grant Lion 100 per cent interest in the blocks subject only to an 18 per cent back-in right in favour of the government.


Block 1 covers about 31,781 square kilometres forming part of western portion of Mandera-Lugh basin that occupies a section of northeastern territory of Kenya and extends into Somalia and Ethiopia.


Mr Thurston said Lion has entered into a farm-in agreement with East African Exploration Ltd (EAX) of Dubai, on the Block 1 concession.


“EAX may earn 50 per cent in block 1 by conducting a work programme and making all financial commitments required of Lion to the government under the PSC,” he said.


Block 2B covers an area of approximately 7,807 square kilometres south of Block 1 in Northeastern Kenya and three separate rift basins; the Anza, Mandera-Lugh and Mochesa.


Raytec and Lion expect to complete their respective due diligence investigations, meet the conditions, and execute a definitive agreement shortly.


The transaction is subject to Toronto Stock Exchange acceptance, as well as approvals from Kenya`s regulatory authorities. A finders fee will be payable in accordance with exchange policies.


© 2009 AllAfrica, All Rights Reserved


Raytec Agrees Farm-In Deal for Three Blocks in Kenya with Africa Oil Corp.
Thomas Pearmain
HIS Global Insight Daily Analysis
September 14, 2009

As part of the ongoing consolidation in Kenya`s upstream sector Canada`s Raytec Metals Corporation has agreed a farm-in deal with Africa Oil Corporation. The agreement, according to Reuters, will see Africa Oil transfer to Raytec a 10% interest in Block 9, a 25% interest in Block 10A, and a 20% interest in Block 10BB. Africa Oil recently acquired Block 10BB from Turkana Energy, Inc. (see Kenya: 23 June 2009: ). Block 10BB is a highly prospective block in the Rift Valley of north-western Kenya, covering some 13,000 sq. km. The deal still needs approval from the appropriate government and regulatory authorities. Significance: Raytec is attempting to establish a leading presence in Kenya`s oil sector, which it believes holds considerable potential, and firms already present in the country are keen to enter into agreements due to the lack of credit available for development plans due to the global economic downturn.


An aggressive programme for the upcoming 12 months is planned, including seismic work on Block 10BB. Earlier this year Africa Oil acquired Lundin Petroleum`s Ethiopian and Kenyan exploration assets for a reported US$20 million.

[sheekh-Farax-zero]

[nomadicwarlord]

I'm moving to Puntland in 2010.