The 8,000 sq. km. Tanga Block has potential for several significant petroleum accumulations. Oil seeps and multiple source units have been identified in the area and prolific sand development may be seen both within the Miocene and the Cretaceous with secondary targets in the Eocene and Paleocene. Existing seismic indicates the presence of multiple hydrocarbon traps.
The paleographic development history of the Tanga Block area shows periodic development of restricted marine environments as well as deeper water marine sedimentation. JEBCO reports the presence of rich oil prone source rock.
EnerGulf believes the eastern coast of Africa is highly prospective for significant hydrocarbon systems. JEBCO holds an option granted to it by the Tanzanian Petroleum Development Corporation ("TPDC") whereby JEBCO has the exclusive right to negotiate the terms of and conclude with TPDC a Hydrocarbon Exploration License and Production Sharing Agreement covering the Tanga Block. JEBCO has also entered into an agreement with TPDC whereby JEBCO has the exclusive right to conduct a new 2-D seismic survey covering the block. Under the terms of the MOU, JEBCO will transfer to EnerGulf all its interest through the drilling and evaluation of the first well on the Tanga Block in exchange for a 5% carried interest through the drilling and evaluation of the first well. JEBCO will then have the right to participate for a 5% working interest in future activities on the block. The MOU is subject to the conclusion and execution of a Definitive Agreement between EnerGulf and JEBCO, the Geophysical Data Acquisition Agreement between JEBCO and TPDC, the Hydrocarbon Exploration License and Production Sharing Agreement between EnerGulf and TPDC and all necessary regulatory approvals.
Commenting for EnerGulf, Jeff Greenblum, Chairman of the Board said, "The Tanga Block agreement moves EnerGulf's business plan forward including our Pan-African strategy of assembling a strong portfolio of high impact exploration opportunities. Further, it marks our entry into Tanzania and will allow us to play a major role in exploring for and developing the area's vast oil and gas potential."
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