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Strategies & Market Trends : Dino's Bar & Grill -- Ignore unavailable to you. Want to Upgrade?

To: Goose94 who wrote (6896)	6/2/2014 8:12:33 AM
From: Goose94	Read Replies (1) \| Respond to of 203421

Simba Energy (SMB-V) gains 20 per cent as its FTG survey work in Kenya shows promise Shares in Simba Energy surged 20 per cent in Toronto last Thursday after the explorer gave an upbeat assessment of early stage exploration work across its 100 per cent-owned Block 2A in Kenya. This is a country that is a fast-emerging hotspot as pioneering Tullow Oil continues to unearth commercial volumes of crude, with planning already underway for an export pipeline to ship the oil to the coast. It's early days yet for TSX Venture-quoted Simba but it already recognises that Kenya is the jewel in the crown: indeed, the Vancouver small cap did well to scoop up this block in 2011 given the jostling for acreage. It now rubs shoulders with the likes of Afren, Premier Oil and Marathon. Block 2A overlies the southern extents of both the Anza basin, one of the largest Tertiary-age rift basins in the East African rift system and with a geological setting similar to the South Lokichar basin where Africa Oil and Tullow have recently had significant discoveries, as well as the Mandera basin, where the Tarbaj-1 well and nearby oil seeps in the south of Block 1 have already confirmed the presence of a petroleum system within Upper Triassic and Jurassic formations. Simba is currently acquiring an airborne FTG survey over its acreage, and the scope of the survey has been expanded to cover what Simba calls a “new and significant target area” identified by the data that has come in so far. The company says the preliminary data has been encouraging and says it indicates the existence of two basinal structures within the Anza Basin's margin: one is a 100 sq km structure in the southwestern most extent of the concession and the second is around 40 sq km and looks to be coincident to the northern extent of the Badada prospect in Taipan Resources (TPN-V) Block 2B to the south, where Premier Oil is farming in for 55 per cent. The company is also acquiring FTG data over the Mandera basin, lying just southeast of the city of Wajir. This survey is almost complete and final results are due within the next four to five weeks. This survey work will help the company plan a 2D seismic campaign for later in the year. According to Simba's CEO, Robert Dinning, the new data has attracted farm-in interest. "Simba has had discussions with a number of companies expressing interest in farming directly in to Block 2A to undertake a 2D seismic programme with a drilling commitment, based on these FTG results currently being generated," said Dinning. This is important. The C$13.6 million market cap company is low on cash – it ended 2013 with cash balances of C$35,000 - and will need partners to fund 2D seismic and drilling work. Last year Simba signed an MoU to farm-out 66 per cent to Ajax Exploration but this was aborted in December when the parties could not agree a work programme. A month later, however, Simba entered a Letter of Intent with a private investment group based in Calgary to farm-out up to 40 per cent for a total investment commitment of US$8.6 million, with a work programme that includes a minimum of 421 km of 2D seismic to be completed this year. The company said in January it hoped to convert the LoI into a firm farm-out by the end of Q1 but shareholders are still waiting for news. The hope must be that promising results from the current survey work will either push that deal over the line or attract additional partners to the table. Simba has done well to bag frontier acreage in this emerging new oil nation – and it also has projects in Chad, Liberia and Guinea – but now faces the challenge common to many oil juniors in the current market: tapping the funds to drill up its acreage. Thursday's announcement was a good start: the shares gained 20 per cent to close at C$0.06.