Gas find offshore Kenya could be commercially viable - Pancontinental

An oil rig and a map of Pancontinental Oil and Gas's block 10A and 10B off the coast of Kenya. Pancontinental has said that it will start drilling for oil and gas on block 10A and 10B next year.  

By David Mugwe

In Summary

• The Australian based explorer on Thursday said that block L8, which it co-owns with American explorer Apache Corp, another Australian explorer Origin Energy and British explorer Tullow, had gas findings which if combined with other discoveries could be commercially viable (See graphic).
• Two months ago, the Australian explorer’s partner on block L8, Apache Corp said that it would cede its stake on the block following the non-commercial gas finds but Pancontinental said that it would increase its stake if the American explorer relinquished its stake
• Pancontinental and its partners this week also disclosed that that they spend between $300 and $400 million over the next one and a half years in exploration activities in Kenya and Namibia

Oil and gas explorer Pancontinental has said that gas found on block L8 off the coast of Kenya could be commercially viable if other wells planned for drilling yield results.

The Australian based explorer on Thursday said that block L8, which it co-owns with American explorer Apache Corp, another Australian explorer Origin Energy and British explorer Tullow, had gas findings which if combined with other discoveries could be commercially viable.

“The well did intersect 52 metres of gas. The well on its own may not currently be commercially viable, but could be when aggregated with other gas discoveries which may occur in the L8 or nearby blocks,” said Ernest Myers, finance director Pancontinental, in a statement.

Pancontinental early this week said that it expects to start drilling at the Sunbird exploration well which is on block 10A in the second week of January.

Two months ago, the Australian explorer’s partner on block L8, Apache Corp said that it would cede its stake on the block following the non-commercial gas finds but Pancontinental said that it would increase its stake if the American explorer relinquished its stake (See graphic).

Pancontinental and its partners this week also disclosed that that they spend between $300 and $400 million over the next one and a half years in exploration activities in Kenya and Namibia.

Some of the funds will be used to drill for oil and gas on block 10A off the coast of Kenya and on block 10B by the middle of the year (See graphic).

The rest of the funds will be used on exploration activities on block L6 where it has a 40 per cent interest, block L8 where it has 30 per cent and Namibia’s block EL 0037 where it has a 30 per cent interest.