Canadian firm set to explore oil in Zanzibar

The Canadian oil firm-Antrim Energy is to start exploration of oil in the small Island of Zanzibar paving the way for resumption of exploration activities on the Production Sharing Agreement (PSA) for the Pemba which has been stalled for some years now.
Under the signed agreement with Ras Al Khaimah Gas Tanzania Limited (RAK Gas) and NOR Energy AS (NOR), will see Antrim Energy replacing its previous right to be carried through the pre-drilling exploration phase of the PSA with a 20 per cent carried interest through the pre-drilling phase and an additional 10 per cent right to participate in the PSA.
The agreement will also see the carried interests of up to 30 per cent to be repaid from future production.
Stephen Greer, President and Chief Executive Officer (CEO) of Antrim Energy, said that concurrent with this agreement, RAK Gas and NOR have entered into an agreement that provides RAK Gas with the option to acquire control of the Pemba-Zanzibar PSA.
“Mr. Greer said that as part of this agreement, RAK Gas has undertaken to re-negotiate the P-Z PSA exploration work programme with Tanzania Petroleum Development Corporation (TPDC) and to secure access rights to the licence area from the relevant authorities.
“We are very encouraged by the entry of RAK Gas into this licence. The Pemba-Zanzibar block has enormous exploration potential, and the area has recently been attracting considerable interest from major petroleum companies,” he said.
The licence which covers 3.5 million acres is in highly prospective oil and gas region that has recently seen significant exploration activity and to the moment, the Licenses on trend are held by Shell, Exxon Mobil, Statoil, Petrobras, Ophir Energy, British Gas and Tullow Oil.
Antrim Energy expect the two agreements, and the participation of RAK Gas in particular, will lead to a resumption of exploration activity on the Pemba-Zanzibar block in the near future.
Tanzania Petroleum Development Corporation (TPDC) expects up to ten offshore wells will be drilled in offsetting licenses in 2010 – 2011, including a three well programme by Ophir – British Gas, two of which were drilled in 2010, two wells planned by Petrobras, one by Statoil, and one by Dominion.
Antrim Energy’s previous option was acquired in 2006 as part of a sale of several assets to NOR, including its wholly owned subsidiary Antrim Resources (Tanzania) Limited.
The Pemba – Zanzibar block has a proven hydrocarbon system, as evidenced by the Tundaua oil seep on Pemba Island and oil shows in previous exploration wells.
Multiple source rocks and petroleum reservoirs are anticipated and numerous prospects mapped. Approximately 75 per cent of the licence lies in water depths of less than 200 metres, with the islands of Pemba and Zanzibar providing potential for on-shore directional drilling.
RAK Gas LLC is the state natural gas utility of the Emirate of Ras al Khaimah in the UAE. It was established in 1984, and in 2007 converted to a limited liability corporation incorporated under the laws of Ras al Khaimah.
The Company’s core business is to source natural gas and markets. In addition, the Company has gas processing facilities and a modest portfolio of E&P assets in East Africa mainly. The Company holds one majority and seven minority interests in exploration blocks in East Africa and in Egypt.