Davy´s take on update

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Davy on Update

Tullow Oil Encouraging exploration and appraisal update from Kenya
09:10 28 Aug 2014 By Davy Research
Etom extends basin-bounding fault play northwards; play now extends 42km
The Etom-1 well in is the most northerly well drilled to date in the South Lokichar basin, 6.5 km north of the previous Agete-1 discovery. The well discovered 10m of net oil pay and extends the basin-bounding fault (‘string of pearls’) play on the west side of the South Lokichar basin. Etom lies in a fault block that is 12 sq km. However, a number of similar prospects to the north and west extend the potential to an area of 32 sq km. The similar prospects will be drilled in 2015; before drilling 3D seismic data will be acquired over the area to help delineate the targets. We assumed that Etom has 20m barrels. Our pre-drill risk-weighted valuation of Tullow’s share of Ewoi is 1p per share; unrisked our valuation is 5p per share.
Aggressive step-out well on southern Amosing discovery firms up volumes
Appraisal work was initiated on Amosing, the most southerly discovery along the western side of the basin and also part of the ‘string of pearls’ play. The Amosing-2 well was drilled from the Amosing-1 well pad and was deviated 1,350 m towards the northeast to confirm the thickness and lateral extent of the Amosing reservoirs. The aggressive step-out well discovered 30m of net oil pay and established the edge of the Amosing structure by locating the oil-water contact. The well was then side-tracked back to some 400m from the discovery and encountered 90m of net oil pay in several pools. An extended well test on the Amosing field is planned for later this year.
Ngamia bigger than previously mapped
The Ngamia-3 well continued appraisal of the Ngamia field, located on the west side of the basin. Ngamia-3 was drilled 1.6km north of the Ngamia-1 discovery and encountered 150m of net oil pay. The well did not establish an oil-water-contact at this location, as intended, and therefore drilling has yet to define the boundary of the Ngamia field. Field mapping will be revised and for now the volume implications are under evaluation.
Shallow Ewoi structure flows 50 bopd
The Ewoi-1 well flowed 50 bopd. The near-surface, low-energy reservoirs at Ewoi, combined with the waxy nature of the oil, probably explains the low productivity at this location. Oils from shallower, cooler reservoirs are generally less productive than those in in deeper, hotter reservoirs.
Ewoi lies on the east side of the South Lokichar basin and is part of the rift flank play, a secondary play in the basin.
Three basin-open wells before year-end; first to spud in September
Drilling on the Kodos prospect is to commence in September. This is the first well to be drilled in the Central Kerio basin and it will target the basin-bounding fault play.
Two additional new basin-opening wells are planned to spud before the end of the year in the North Kerio Basin (Epir-1) and the North Turkana Basin (Engomo-1).

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