Swala targets Burundi oil firm

Dar es Salaam. Swala Oil and Gas (Tanzania) Plc has entered into an agreement with Surestream Petroleum Limited to acquire the latter’s wholly-owned subsidiary.

The subsidiary -- Surestream Petroleum Limited-- has a 100 per cent working interest in Block D in Burundi, Swala Oil and Gas said in a statement yesterday.

The block is partly onshore and partly offshore, and covers portions of the northern end of Lake Tanganyika, an area where oil seeps, slicks and tar balls have been reported

In consideration for the equity in Surestream Burundi, Swala shall issue Surestream 6,247,154 fully paid ordinary shares in Swala.

The amount represents 6.25 per cent of Swala’s post-acquisition issued share capital. On completion of the transaction Swala shall have 106,201,618 shares in issue.

Block D is located along Burundi’s western border with the Democratic Republic of Congo at the northern end of Lake Tanganyika. The licence primarily encompasses the offshore part of the lake, with minor acreage onshore. This region is of particular interest as it lies on the same trend as the multi-billion barrel Lake Albert oil discoveries along the western branch of the East African Rift System.

The northern end of Lake Tanganyika consists of four half grabens, each with Neogene-aged rift sediments in excess of 4000m, significantly thicker than the analogous oil-bearing Albertine Basin. High geothermal gradients are likely to lead to maturity at shallower depths and thus open up the potential of shallow trapping in addition to deeper targets.