London Company Invests in East African Oil

Brian Hicks

Written By Brian Hicks

Posted October 26, 2012

U.K.-based Afren Plc (LON: AFR) intends to invest around $120 million in East African oil drilling over two years. In the immediate term, Afren hopes to bore four exploratory wells.

East Africa has emerged as a highly attractive prospect recently, bringing in companies like Royal Dutch Shell Plc (NYSE: RDS.A) and Total SA (NYSE: TOT).

It came to the world’s attention when Anadarko Petroleum Co. (NYSE: APC) made a massive gas discovery just off Mozambique. Earlier this year, Shell and PTT Exploration and Production Pcl (PINK: PEXNY) of Thailand got embroiled in a bidding war for Cove Energy Plc (LON: COV), Anadarko’s partner in the region.

Afren presently is licensed to operate in Kenya, Tanzania, Madagascar, Ethiopia, and the Seychelles, according to Associate Director Galib Virani.

Collectively, these five countries could hold almost 5.8 billion barrels of resources, Bloomberg reports.

Afren has already begun drilling in Kenya’s Block 10A, where the Paipai-1 well is located. Afren has a 20 percent stake there, and the block is operated by Tullow Oil Plc (LON: TLW).

Afren also holds licenses for operations in Nigeria, Ghana, the Republic of Congo, and the Ivory Coast.

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