Savannah announces third oil discovery in Niger

LONDON -- Savannah Petroleum announce that its Kunama-1 exploration well has discovered oil bearing sands. The discovery is the third consecutive find Savannah has made in its maiden exploration campaign in the R3 portion of the R3/R4 PSC Area in the Agadem Rift Basin (“ARB”), southeast Niger.

Well Result

Preliminary results based on the interpretation of the available data set (which includes wireline logs, fluid sampling and pressure data) indicate that the well has encountered a total estimated 9m of net oil bearing reservoir sandstones in the E1 and E5 reservoir units within the primary Eocene Sokor Alternances objective. Wireline logs indicate the reservoir properties to be good quality and the available data indicates light oil equivalent to the Amdigh-1 well (the second discovery well announced by Savannah on June 6, 2018), and consistent with offset wells along trend and the depth/API trend observed across the basin. Oil samples from the E1 and E5 reservoir units have been taken and returned to surface using wireline testing equipment.

Drilling Performance

The well was drilled to a total measured depth of 2,460 m, and encountered the main objective targets at, or near, their prognosed depths. The well took a total of 14 days to reach target depth, and all operations are expected to be completed within 23 days of spud. This compares with a pre-drill expectation of 22 days to reach target depth and 30–35 days to complete all drilling operations. No significant geological or drilling hazards were encountered.

Next Steps, Exercise of Drilling Rig Option and Eridal-1

Kunama-1 is currently being suspended for future re-entry. Consistent with standard industry practice in the ARB, a production test is expected to be performed on the well as part of a batch campaign using a dedicated test rig. This extended well testing program is currently being planned for later in the year and the Company intends to provide further details in due course. Following testing, a downhole

completion assembly to Amdigh-1 is expected to be installed so as to enable the well to function as a production well in the future. Savannah does not expect to provide a discovered resource and volumes report until its expected well test program has been completed.

Following the successful results of the three exploration wells drilled to date on the R3 East area, Savannah has elected to exercise the first of the six individual options under its contract with Great Wall Drilling Company Niger SARL. The GW 215 rig will now mobilize to the Eridal-1 well site, located on the R3 portion of the R3/R4 PSC Area 6km from Amdigh-1, where it will prepare to spud the Eridal-1 exploration well. Following the exercise of this option, Savannah will continue to have options for a further five wells, each of which can be exercised individually at Savannah’s discretion.

Eridal-1

The Eridal-1 well site preparation is in the final stages of completion and is on schedule to accept the rig following demobilization from the Kunama-1 well site. The move is anticipated to take between 10 – 15 days, and the Company will provide an update upon spud of the well.

As with the previous wells drilled in this campaign, the well is designed to evaluate potential oil pay in the Eocene Sokor Alternances as the primary target, with the secondary target of potential oil pay in the Eocene Upper Sokor being considered as upside.

Andrew Knott, CEO of Savannah Petroleum, said: “This is clearly an exciting time for Savannah and our stakeholders. The Kunama discovery, following on from Amdigh and Bushiya, provides further encouragement for our plans to establish an early production scheme in Niger, which we expect to be able to provide an update on later in this quarter. The improved understanding of the R3 geology we have gained from the outcome of these wells has also given us the confidence to extend our campaign to target the Eridal prospect, located in close proximity to Amdigh, and we expect to provide updates on further potential additional drilling activity over the course of the coming months.