An anonymous director reports

AFRICA OIL ANNOUNCES AN INCREASE IN ITS OPERATED INTEREST IN BLOCK 3B/4B

Africa Oil Corp. has entered an agreement to increase its operated working interest (WI) in block 3B/4B, located in the Orange basin offshore South Africa and on trend with the Venus, Graff, La Rona and Jonker oil discoveries, for an additional 6.25-per-cent interest.

An independent review of the prospective resources and probability of geological success of an inventory of exploration prospects within block 3B/4B, has reported total unrisked gross P50 prospective resources of approximately four billion barrels of oil equivalent. Probability of success ranges from 11 per cent to 39 per cent over the 24 prospects identified.

The company has signed a legally binding letter of intent (LOI) with Azinam Ltd., a wholly owned subsidiary of Eco (Atlantic) Oil & Gas Ltd., to acquire the 6.25-per-cent interest for a total cash consideration of $10.5-million (U.S.), to be paid in tranches on the following milestones:

• $2.5-million (U.S.) within 30 days after the signing of the LOI;
• $2.5-million (U.S.) upon the government's approval for the transfer of the 6.25-per-cent interest to Africa Oil;
• $4.0-million (U.S.) upon the completion of a farmout deal to a third party;
• $1.5-million (U.S.) upon spudding of the first exploration well on the block.

Africa Oil is a major shareholder in Eco with a 15.02-per-cent shareholding. The company's directors, other than Keith Hill, who is also a director of Eco, have reviewed and approved the terms of the LOI.

The company will hold an operated WI of 26.25 per cent subject to and, on the receipt of the government's approval for the transfer, with Azinam holding a 20.00-per-cent WI and Ricocure Pty. Ltd. holding the remaining 53.75-per-cent interest.

The company and its block 3B/4B partners are progressing plans to conduct a two-well campaign on the block and are in discussions with various potential partners to farm out up to a 55-per-cent gross working interest in the block. The company and its partners have also selected a leading South African environmental consulting firm to conduct a comprehensive environmental and social impact assessment process in preparation for permitting and drilling activity on the block.

About block 3B/4B

Block 3B/4B covers an area of 17,581 square kilometres within the Orange basin offshore of the Republic of South Africa. This block lies to the southeast and on trend with number of oil discoveries including Venus and Graff. An independent review of the block's prospective resources has been completed by RISC Advisory (U.K.) Ltd., in accordance with Canadian National Instrument 51-101 -- Standards for Oil and Gas Activities, the Canadian Oil and Gas Evaluation Handbook (COGE Handbook) and the Petroleum Resources Management System 2018 (PRMS). The effective date of RISC's report is March 7, 2023, and can be found on the company's website.

RISC has reviewed the prospective resources and probability of geological success of 24 exploration prospects within block 3B/4B in accordance with the PRMS. The report provides an evaluation of prospective resources from a prospect inventory identified using 3-D seismic data and follows completion of the reprocessing of 2,200 square km of 3-D seismic data and play-opening discoveries in Namibia including TotalEnergies' Venus discovery and Shell's Graff, La Rona and Jonker light oil discoveries. These discoveries prove the existence of a working petroleum system for light oil, gas condensate and gas in the geological play fairway. The proven reservoirs in Graff and Venus discoveries are similar to Cretaceous reservoirs and geological plays that would be targeted in block 3B/4B. Prospects in block 3B/4B are identified using 3-D seismic data to assess the presence of seismic attributes including amplitude-variation-with-offset (AVO) or direct hydrocarbon indicators (DHIs).

About Africa Oil Corp.

Africa Oil is a Canadian oil and gas company with producing and development assets in deepwater Nigeria and an exploration/appraisal portfolio in west and south of Africa, as well as Guyana. The company is listed on the Toronto Stock Exchange and on Nasdaq Stockholm under the symbol AOI.

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