Africa Oil Corp.

Africa Oil Corp.

May 27, 2009 11:01 ET

Africa Oil Signs Farmout Agreement With East Africa Exploration Limited Over Ethiopia and Kenya Blocks

VANCOUVER, BRITISH COLUMBIA--(Marketwire - May 27, 2009) - Africa Oil Corp. (TSX VENTURE:AOI) ("Africa Oil" or "the Company") is pleased to announce the execution of a farmout agreement with Black Marlin Energy Limited's East Africa Exploration Limited ("EAX") unit for their entry into the production sharing contracts in both the Federal Democratic Republic of Ethiopia and the Republic of Kenya.

In Ethiopia, Africa Oil will transfer a 30 percent license interest to EAX in the Blocks 2/6 and 7/8 Petroleum Production Sharing Agreements located in the highly under-explored Ogaden Basin of southern Ethiopia.

In Kenya, Africa Oil will transfer a 20 percent license interest to EAX in the prospective Block 10A Production Sharing Contract, located in the Anza Basin of northern Kenya.

EAX, in both areas, will pay a disproportionate share of costs associated with the planned 2D seismic programs to be carried out in 2009-10 as well as paying a portion of Africa Oil's past costs and future operational costs. Africa Oil has executed a seismic contract with Upstream Petroleum Services Limited (UPSL) to undertake the seismic acquisition in both Ethiopia and Kenya. Africa Oil remains Operator of all blocks associated with this transaction.

This farmout transaction is subject to approvals of the appropriate regulatory authorities from the Government of the Federal Democratic Republic of Ethiopia and Republic of Kenya in addition to waiver of pre-emptive rights by an existing partner in the Ethiopian licenses.

Rick Schmitt, President of Africa Oil, commented, "I am pleased to announce this strategic transaction and welcome our new partners, Black Marlin and EAX, to our East Africa exploration ventures. Both Africa Oil and EAX bring strong technical experience to the Joint Venture and both companies maintain a common focus on East African exploration. I look forward to moving our operations forward with EAX and current strong partner, New Age (African Global Energy) Ltd., into the seismic acquisition phase to be followed shortly thereafter by an exciting round of exploratory drilling across all of Africa Oil's assets."

Africa Oil Corp. is an oil and gas company listed on the TSX Venture Exchange under the symbol "AOI". Africa Oil's East African holdings are in what is considered a truly world-class exploration play fairway. The Company's total land package in this prolific region is in excess of 200,000 square kilometers - an area roughly the size of Great Britain. The East African Rift Basin system is one of the last of the great rift basins to be explored. New discoveries have been announced on all sides of Africa Oil's virtually unexplored land position including the major Heritage/Tullow Albert Graben oil discovery in neighbouring Uganda. Similar to the Albert Graben play model, Africa Oil's concessions have older wells, a legacy database, and host numerous oil seeps indicating a proven petroleum system. Good quality existing seismic show robust leads and prospects throughout Africa Oil's project areas.


Rick Schmitt, President

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