AFRICA OIL ANNOUNCES COMPLETION OF THE STRATEGIC FARM DOWN OF IMPACT'S NAMIBIAN INTERESTS AND PROVIDES AN OPERATIONAL UPDATE ON NAMIBIA

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VANCOUVER, BC, Nov. 1, 2024 /CNW/ - (TSX: AOI) (Nasdaq-Stockholm: AOI) – Africa Oil Corp. ("Africa Oil", "AOC" or the "Company") is pleased to announce that its investee company Impact Oil & Gas Limited ("Impact") has completed the farm down ("Farm Down") of its interests in Blocks 2912 and 2913B offshore Namibia ("Blocks") to TotalEnergies EP Namibia B.V. Impact has also received a cash payment of approximately USD 99 million, as reimbursement for its share of costs incurred on the Blocks net to the Farm Down interests, prior to January 1, 2024 ("Effective Date"). View PDF version

Impact has retained a 9.5% interest in each of the Blocks and will benefit from a carry loan for all its remaining development, appraisal and exploration costs on the Blocks from the Effective Date, until the date on which Impact receives the first sales proceeds from oil production on the Blocks ("First Oil Date"). The carry loan is repayable from a share of Impact's after-tax cash flows, and net of all joint venture costs, including capital expenditures, from production on the Blocks.

Africa Oil President and CEO, Roger Tucker commented: "The Farm Down allows Africa Oil to retain a funded interest in the Venus development project that is expected to add significant reserves and production to our portfolio. We also believe there is tremendous exploration upside on the Blocks starting with the recently spud Tamboti-1X well.

The Farm Down completion also satisfies a condition precedent to the amalgamation to effect the consolidation of all of Prime Oil & Gas Co?peratief U.A. in Africa Oil. We expect to close the amalgamation during the first quarter of 2025 which will then allow us, subject to customary Board approvals, to implement the enlarged shareholder returns program, as previously communicated in our Prime consolidation press release of June 24, 2024".

Africa Oil currently has a shareholding of approximately 32.4% in Impact. On the closing of the call and put option agreement with three Impact shareholders that was announced on August 27, 2024, the Company will increase its shareholding in Impact to approximately 39.5%, which represents an effective economic interest of approximately 3.8% in the Blocks.

Namibia Operational Update

Following the 2022 Venus-1X discovery well, four further exploration and appraisal wells have been drilled on the Blocks to date. Of the five wells drilled, four have, successfully penetrated and tested  the Venus field. As a result, planning is currently progressing for the first development area, with a development scheme expected to be finalized by the end of 2025.