/ Operations

Operations

Dharoor and Nuggal Blocks

During 2009, in the Dharoor Block of Puntland, Somalia, the acquisition of 782 kilometers of good quality 2D seismic (comprised of 15 grid lines) was completed. The Company has combined this with 555 kilometers of previously acquired data into the seismic database which has been mapped to determine exploration well locations.

In the Nugaal Block in Puntland, Somalia, the Company acquired more than 4,000 kilometers of existing good quality 2D data which was recorded in the late 1980's. This has enabled the Company to work up an inventory of drilling prospects on the block.

The Shabeel and Shabeel North prospects on the Dharoor Block are located on a Jurassic aged rift system which is part of the same system that has proven to be highly productive in the Masila and Shabwa Basins in Yemen that contain an estimated 6 billion barrels of oil. The Company holds interests in production sharing agreements ("PSAs") in the Dharoor Valley Exploration Area and the Nugaal Valley Exploration Area located in Puntland (Somalia). (See Current Activities for exploration updates.)
Current Activities
Country Project Program News Releases
Puntland,  Somalia   Given the considerable efforts taken by the Company to date in Puntland (Somalia), the Company has requested a two year extension to the current exploration period from the Government of Puntland to allow time for political challenges to be resolved.
 
February 12, 2015
There have been some significant political changes in both Somalia and the Regional State of Puntland over the last couple of years that are shaping the climate in which the Company operates. At the Federal level, the new Somali Government took power in August 2012 as the first permanent central government in the country since 1991. While internationally recognized and supported, it is still fragile and faces many challenges both politically and security wise. In January 2014, a new President of Puntland was voted in and the transfer of power took place peacefully. Management is working closely with him and his emerging new government to take forward a range of key issues that impact our operations.
 
November 12, 2014
As previously announced, Horn is actively reviewing several oil exploration projects for possible acquisition. The Company is currently in discussions over a potential project but cautions that there are no guarantees that such an acquisition will be concluded.
 
March 21, 2014
Block Summaries

Block Summary
Block Partners
Dharoor Africa Energy (Operator) 60%
Range Resources 20%
Red Emperor 20%
Nugaal Africa Energy (Operator) 60%
Range Resources 20%
Red Emperor 20%

Please refer to independent NI 51-101 resource evaluation report effective June 30, 2011, posted on September 8, 2011 on www.sedar.com for full disclosure and resource definitions. Report is entitled "Evaluation of the Interests of Denovo Capital Corp. in Two Production Sharing Contracts in Dharoor Valley and Nugaal Valley Blocks, Somalia" Year End 2014

PUNTLAND


The Company has informed the Government of Puntland (Somalia) that the Company will be significantly reducing its presence in Bosaso, Puntland and will refrain from any operational activity and associated expenditures pending a resolution of the political situation between the Regional Government of Puntland and the Federal Government of Somalia regarding the legitimacy of oil concession contracts. Given the considerable efforts taken by the Company to date in Puntland (Somalia), the Company has requested a two year extension to the current exploration period from the Government of Puntland to allow time for these political challenges to be resolved. Accordingly, the Company has elected during the fourth quarter of 2014 to record a $90.6 million non-cash impairment charge related to its assets in Puntland. As at December, 2014, intangible exploration assets related to these properties was nil.

NEW VENTURES

Africa Energy is actively pursuing new venture opportunities across the African continent.


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