Simba Energy Inc. ("Simba" or the "Company") (TSXV: SMB; Frankfurt: GDA; OTCQX: SMBZF), the onshore Pan-African oil & gas explorer, is pleased to announce that a Protocole d’Accord has been signed between Simba Energy Inc. and the Republic of Chad granting the Company 100% interests in the Production Sharing Contracts (PSCs) on three prospective oil & gas concessions in the Doba, Doseo and Erdis basins. By signing the Protocole d’Accord, both parties agree to finalize the first year work program and execute the PSC documentation by October 20, 2012.
Simba’s Managing Director of Operations, Hassan Hassan stated, “Simba is very enthusiastic about the potential of having secured 100% interests in these three concessions. Each block is potentially a company maker in its own right and nicely complements our existing asset portfolio in terms of long-term growth potential. We consider this a unique and significant early-in opportunity for the Company and its shareholders.”
The first two (adjacent) concessions, comprising a total of 10,111km² in southern Chad are referred to as: “Chari Sud Block I” (6,400km²), and the southern 50% of “Chari Sud Block II” (3,711km²). These blocks lie directly south of Griffiths Energy’s & Glencore International’s DOB, DOI and Borogop blocks where the nearby Mangara and Badila oil fields are located and further proven reserves are currently under advanced appraisal and production development. Gravity and magnetic surveys across both Chari Sud Blocks I & II, along with existing 2D seismic, indicate the same basin morphology as the producing fields. Pipeline infrastructure skirts the NW corner of Chari Sud Block I. The blocks are located in the southern margins of the Doba and Doseo basins as part of the West and Central African Rift System that extends across central Africa from Nigeria to Kenya.
Last week, Glencore International PLC -- the Swiss commodities giant -- signed an agreement with Griffiths Energy to invest up to US$300 million over three years to earn a 25% working interest in the Mangara and Badila oilfields’ development and future production.
The third concession, Erdis Block III, totalling 15,700km², is located in the southern portion of the Erdis basin (known as the Kufra basin in Libya) which covers approximately 400,000km² extending across NE Chad, NW Sudan, and SE Libya. The Erdis basin is one of several adjacent intracratonic basins across North Africa that share sedimentological and geological history and together form a Palaeozic mega-province where significant current production already exists and substantial potential remains underexplored. There are numerous oil discoveries to the north in Libya while recent seismic on Sudan’s Block 14 to the east looks prospective with two wells planned. With sediments to 11,000 metres ensuring maturity is present, gravity across the entire block also indicates the presence of a major deposition center, which enhances major reservoir development.
To view maps providing location and details of Simba Energy’s above concessions in the Republic of Chad, please visit the Company’s website at www.simbaenergy.ca or select the following link: www.simbaenergy.ca/projects/chad.aspx
About Oil Production in Chad:
With current proven reserves over 1.5 billion barrels, exploration for oil in the Republic of Chad dates back to the 1960’s with first discoveries being made by the mid ‘70’s by the Esso Chad Consortium (ExxonMobil, Chevron, Petronas) and China National Petroleum Corporation (CNPC). The Consortium discovered six fields that have combined reserves of almost a billion barrels of oil. In 2003, the Chad-Cameroon export pipeline was completed. Production from Esso Chad peaked at 220,000b/d and is currently around 115,000b/d or 50% of capacity. Over 400 million barrels of oil have been produced from Chad in the last eight years.
James Dick, P.Geol., P.Eng., Director, and Qualified Person in accordance with National Instrument 51-101, has reviewed and approves the technical disclosure in this news release.
About Simba Energy Inc.
Simba Energy Inc. is an onshore Pan African oil & gas exploration company focused on onshore opportunities across Africa. In addition to having just secured these blocks in Chad, the Company holds 100% interest in the Production Sharing Contract (PSC) for Block 2A in Kenya, 60% interests in Blocks 1 & 2, onshore Republic of Guinea and is awaiting finalizing the PSC for Block 3 in Mali. It also has applications pending for onshore blocks in Liberia and Ghana.
ON BEHALF OF THE BOARD
"Robert Dinning", President & CEO