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2016-05-16

AFRICA OIL 2016 FIRST QUARTER FINANCIAL AND OPERATING RESULTS

INANCIAL AND OPERATING RESULTS

May 13, 2016 (AOI–TSX, AOI–Nasdaq-Stockholm) … Africa Oil Corp. (“Africa Oil”
or the “Company”) is pleased to announce its financial and operating results
for the three months ended March 31, 2016.

At March 31, 2016, the Company had cash of $523.6 million and working capital
of $474.4 million. The Company’s liquidity and capital resource position
improved dramatically during the first quarter of 2016 with the receipt of
$439.4 million (inclusive of deposit received prior to year-end) upon
completion of the previously announced (November 9, 2015) farmout transaction
with Maersk Olie og Gas A/S (“Maersk”) whereby Maersk acquired 50% of the
Company’s interests in Blocks 10BB, 13T and 10BA in Kenya and the Rift Basin
and South Omo Blocks in Ethiopia. Proceeds received from Maersk include $350.0
million as reimbursement of past costs incurred by the Company prior to the
agreed March 31, 2015 effective date and $89.4 million representing Maersk's
share of costs incurred between the effective date and closing, including a
carry reimbursement of $15.0 million related to exploration expenditures. An
additional $75.0 million development carry may be available to the Company upon
confirmation of existing resources. Upon Final Investment Decision ("FID"),
Maersk will be obligated to carry Africa Oil for an additional amount of up to
$405.0 million depending on meeting certain thresholds of resource growth and
timing of first oil.

The Company completed the following significant operational activities during
and subsequent to the first quarter of 2016:

-- On May 10, 2016, the Company announced details of an updated independent
assessment of the Company’s contingent resources in the South Lokichar
Basin in Blocks 10BB and 13T (Kenya). The estimated gross 2C unrisked
resources in the South Lokichar Basin, Kenya have increased by 150 million
barrels (or 24%) since they were previously assessed during 2014 to 766
million barrels of oil (Development Pending: 754 million barrels and
Development Unclarified: 12 million barrels).

-- The Cheptuket-1 well (Block 12A) completed drilling to a depth of 3,083
meters. The well encountered oil shows, seen in cuttings and rotary
sidewall cores, across a large interval of over 700 meters. Cheptuket-1 is
the first well to test the Kerio Valley Basin proving the existence of a
working petroleum system in a basin several hundred kilometers distant from
the South Lokichar Basin. Additional technical work is required to analyze
the results and consider a program to follow up on this result. The PR
Marriott Rig-46 rig was released following completion of the well.

-- Late in 2015, the results of the Etom-2 well in the South Lokichar Basin
(Block 13T) were announced. The Etom-2 well was drilled based on recently
acquired and interpreted 3D seismic in a previously undrilled fault block
adjacent to the Etom oil discovery. The well encountered 102 meters of net
oil pay in two columns. Oil samples, sidewall cores and wire line logging
all indicate the presence of high API oil in the best quality reservoir
encountered in the South Lokichar Basin to date. Discovering this thick
interval of high quality oil reservoirs at Etom-2 further underpins the
development options and resource base in the South Lokichar Basin. The
result follows careful evaluation of 3D seismic data which was shot after
the Etom-1 well completed drilling and demonstrates how the partnership has
improved its understanding of the basin. This result also suggests
significant potential in this underexplored part of the block as it is the
most northerly well drilled in the South Lokichar Basin and is located
close to the axis of the basin away from the basin-bounding fault.
Accordingly, the resource potential of the greater Etom area and
neighboring prospects is being considered as part of a future exploration
drilling program.

-- Subsequent to the first quarter of 2016, the Governments of Uganda and
Kenya announced that separate export pipelines would be developed for the
export of production from the development of oil resources in their
respective countries. The Company intends to continue working closely with
the Kenyan Government and our upstream partners to move the upstream and
midstream development projects forward. Pre-Front End Engineering and
Design (“FEED”) work on both these elements is well advanced and it is
expected that FEED will commence in the near term. It is expected that any
Kenya standalone pipeline plan will take into consideration the potential
to accommodate the transportation of additional oil resource from bordering
East Africa countries.

-- Over 1,100 meters of whole core has been acquired from the wells drilled in
the South Lokichar Basin, and an extensive program of detailed core
analysis is ongoing that will provide results throughout the year. A key
focus of the core program is to better assess oil saturation and to refine
the recovery factors of the main reservoir sands. Early core analysis
results support the reservoir assumptions used in the contingent resource
estimate and support the view of oil saturations in the reservoir.

---

For the complete news release and report, see attached file.

For further information, please contact: Sophia Shane, Corporate
Development (604) 689-7842.

Författare SSE

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