Madagascar (WI 60%)
In November 2006 Candax signed a PSA with the Madagascan Government for the oil and gas rights of Block 1101 onshore in the north of the country and received Presidential Decree in 2007.
The Block covers 14,900 square kilometres and is adjacent to of the Exxon operated, offshore, Ampasindava Block and the Ambilobe Block of Sterling where Exxon has farmed-in.
Block 1101 offers Candax a low cost entry into one of East Africa's most prolific oil provinces with billion barrel potential. To date in its onshore Tsimiroro and Bemolanga fields, Madagascar has reported 30 billion barrels of discovered tar sands/heavy oil (8° to 16° API). Lighter oils (22° and 45° API) have also been discovered onshore, and are the target of new exploration both onshore and offshore. Candax (60% and Operator) and its partner EAX acquired the Block in the 2006 onshore Licensing Round.
Whilst the acquisition of Block 1101 is a departure from Candax's core production/development based strategy, the Block offers low cost, high impact exploration potential. Limited data is currently available across the Block and a program of geological mapping, seismic acquisition and shallow drilling is planned in the first two years (Phase 1). The three-phase exploration program has a total commitment of US $6 million of which phases 2 and 3 are optional.
Analogies of the large geological anticlinal features that have formed the multi-billion fields of Tsimiroro and Bemolanga are believed, from initial geological mapping available to the partners, to be present within Block 1101. As well as numerous identified oil seeps onshore within the Block, a recent satellite-based oil seep study has indicated the presence of numerous active seeps just offshore. During 2007 and 2008.
Results from the initial geological field work, geochemistry and gravity / magnetics have confirmed the high potential of Block 1101. Over 5,000 metres of sedimentary section have been identified beneath the Block, together with numerous oil shows. In September 2008, Candax commenced a 2D seismic acquisition program which was completed in late 2008 on time and under budget. Approximately 160 line kilometres were acquired in the Ambilobe area and a further 20 line kilometres in the Ankaramy area. Processing and interpretation is currently underway, as well as prospect generation and ranking results from the geological fieldwork and seismic are very encouraging and indicate the possibility of a number of very sizable propects and leads.