London, 20 December 2005 - FirstAfrica Oil plc (AIM:FAO) ('FirstAfrica' or 'the
Company'), the upstream African oil and gas company, is pleased to announce that
it's wholly owned subsidiary GulfofGuinea Petroleum Corporation Gabon (EOV)
Limited ('GGPC') has received approval from the Government of the Gabonese
Republic for the field development plan for its East Orovinyare Oil Field
offshore Gabon ('EOV Field').
The fast-track development plan calls for the first appraisal/development well
to be drilled from early January 2006 with the arrival in the field of the
Global Santa Fe Adriatic IX jack-up rig. The previously announced mid-December
2005 spud of EOV-4 has been delayed by three weeks due to extended operation of
the drilling rig on its previous contract.
GGPC is the permit holder (100%) and operator of the EOV Field, which is located
13 kms offshore in 20m of water. Oil was discovered by the previous operator,
Marathon, in the late 1990's. In addition to the discovered oil, the broader
East Orovinyare Permit Area holds potential for incremental production from
several exploration prospects currently under evaluation.
Following the January 2006 drilling and testing of the EOV-4 well, GGPC has
further contracted for a 100-day drilling program with Global Santa Fe for the
Adriatic VI jack-up drill rig, which is currently estimated to arrive in the
Field during the first week of April 2006. It is anticipated that three
additional development wells will be drilled and completed as well as an
exploration well to prove up the broader prospect. The development plan
incorporates unmanned well head structures tied back to a Floating Production,
Storage and Offloading vessel (FPSO). Production of the light crude (37.5 API)
will be processed on the FPSO and is expected to commence in late 2006.
The Company will require additional funds to implement and complete the
estimated $68 million field development programme during 2006. The FirstAfrica
board is considering a number of different financing alternatives, including
(but not limited to) an equity fundraising, project/debt finance, and a
partnership or farm-in arrangement with a third party.
Further, with regards to third-party negotiations announced on 30 March 2005,
the Company wishes to advise that, at this time, there is no further update to
the announcement made on 7 October.
Commenting on the Gabon government's approval of the Field Development Plan,
FirstAfrica CEO Robert Kirchner said, 'the Gabonese government typically
requires a minimum of 30 days for review and approval of field development
plans. For FirstAfrica to receive immediate approval of its plan for EOV is a
testament to the technical quality of this fast-track project and our excellent
working relationship with the various agencies of the Government of the Gabonese
Republic.'
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